Utah has weathered the financial roller coaster of the last several years relatively well especially in comparison to other states. We are consistently ranked one of the best places to work and live. Our unemployment rate is low. Our infrastructure is sound. And our state budget is balanced.
Wise decisions by our state and municipal lawmakers are often touted as the primary reason Utah continues to lead the nation in economic vibrancy. And while government can definitely both help and hinder economic growth, private sector companies and individuals are the real fuel behind our strength.
One unexpected example of this is Lacy B. Herrmann. Most Utahns will not recognize this name, but if you've passed by the University of Utah or Weber State University campuses, the Salt Lake City TRAX lines, the Dixie Center in St. George or the Utah Valley University Student Center in Provo, you have seen the results of his quiet, behind-the-scenes contributions to communities throughout our state.
Those development projects, and many more, were made possible, in part, by Tax-Free Fund For Utah, an innovative investment entity Lacy launched on Pioneer Day, 1992. It is the oldest and only existing municipal-bond fund in Utah.
In 1984, he founded Aquila Management Corp., sponsor of several tax-free mutual funds in the United State that invest in municipal bonds used by cities, counties, states, school districts, redevelopment organizations and other government agencies to finance the construction of everything from highways to hospitals. In addition to Tax-Free Fund For Utah, he created single-state tax-free municipal-bond funds in Arizona, Colorado, Hawaii, Kentucky, Oregon and Rhode Island.
Lacy wasn't the first person to see the win-win potential of tax-free municipal bonds, but he found a special niche by insisting that his funds are overseen by local trustees, officers and portfolio managers.
In Utah, as in each of the mutual funds' home states, he also established the practice of holding annual shareholder meetings; the Aquila Group of Funds is one of the few mutual-fund sponsors in the nation to hold such meetings. These meetings allow shareholders from every walk of life and income level to interact with corporate representatives face-to-face, ask questions and learn exactly how their money is being invested.
Shareholders in municipal-bond funds like Tax-Free Fund For Utah generally pay no federal or state taxes on income from these investments. Offering such tax breaks is a way for county and state governments to spur growth and improve infrastructure that could not be paid with cash on hand. They also save taxpayers money because, while such bonds pay lower interest, they can still attract investors thanks to their double federal and state tax-free status.
Lacy passed away late last year in Sleepy Hollow, N.Y., at the age of 83. But thanks to his vision as one of the earliest creators of single-state tax-free municipal-bond funds, his legacy lives on, bringing countless benefits to the residents of our state
Lyle Hillyard is a Utah state senator. He and Gary Cornia are trustees for Tax-Free Fund For Utah.