This is an archived article that was published on sltrib.com in 2011, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.
Utah's Legislature has a $313 million nightmare. It's called the structural deficit, meaning that the state spends more in a given year than it collects in revenues. Because of that, legislators are about to adopt a base budget that slashes spending by 7 percent to eliminate that deficit. This would come on top of the billion dollars of state spending eliminated since the Great Recession began.
What would further cuts mean? They would mean impoverishing Utah's already starving public schools by cutting another $166 million from the eduction budget. It would mean releasing 847 prisoners early. It would mean closing courthouses and laying off Highway Patrol troopers, including a special unit that catches drunken drivers. It would mean cutting social services to some 36,000 low-income and disabled people. It would mean ending dental and vision coverage for about 8,200 pregnant, low-income mothers over the age of 21. And on and on.
Oddly, though, the elimination of state jobs and cuts to public services are not what keep fiscal conservatives up at night. Rather, that structural deficit is the bogeyman.
As with many other policy debates, this one is a matter of perspective. Yes, sustained structural deficits are a bad thing. Debt is a useful and beneficial financial tool, but only if it is carefully managed and does not grow too big. But compared to most states and the federal government, Utah's structural deficit is not a serious problem. And by obsessing about the structural deficit, legislators actually could harm the state economy by hollowing out essential government services and adding to unemployment.
To a certain extent, this whole exercise is political theater, because state revenues are expected to grow by $216 million in the fiscal year that begins July 1. Legislators will begin plowing that new money into the budget after they adopt the base budget this week.
But if the most fiscally conservative lawmakers stand by their pledge not to use $100 million of the state's Rainy Day Fund or collect state income tax withholding quarterly from the self-employed, both of which Gov. Gary Herbert has rightly proposed, Utah could indeed see a budget bloodletting.
By the way, under Gov. Herbert's budget proposal, the structural deficit would be reduced by $100 million and there would $110 million remaining in the Rainy Day Fund (the state's savings account).
The trouble with bleeding a patient is that if the doctor does it too often, the patient dies.