"There are serious tax policy issues with this proposal, including questions about whether the state will retain its Triple-A bond rating," said commission Chairman Keith Prescott, who wants further study before issuing any such advisory.

An advisory board to the governor and Legislature composed of attorneys, tax experts and legislators, the commission has no power to stop the initiative from becoming law. But should voters approve the $150 million bond for the purchase and preservation of open space and other critical lands, a commission warning could open the door to legislative amendments.

It also could delay issuance of the bond.

But proponents of the bond called the problems "easily surmountable technicalities."

"The commission didn't point out anything fundamentally wrong with the initiative," said Dave Livermore, Utah Nature Conservancy director.

"All we know is 130,000 people signed the petition to get this on the ballot. These types of issues come up anytime a new law is passed, whether by the people or the Legislature."

Questions that the commission hopes to have answered before its next meeting on Oct. 5 include whether the bond, because it is guaranteed by general sales tax revenue, would prevent the Legislature from cutting sales tax rates; and whether it would count against the state's bonding limit.

Commission members also fear that once the bond money is used to buy property, that land is taken off the property tax rolls, meaning less revenue for education and other government services.

State Treasurer Ed Alter said he doesn't believe adding $150 million to Utah's $1.5 billion debt will hurt the state's sterling bond rating. But he questions the wisdom of using "this scarce resource" for open space rather than for highways or new buildings.

Alter, who is up for re-election this year, also notes that the initiative doesn't include a mechanism to pay for the cost of underwriting and issuing the bond, which he pegs at $900,000.

Prescott sits on the board of directors of the Utah Taxpayers Association, which opposes the initiative. But he said, "I'm not opposed to open space, clean air or clean water and all the good apple pie things that this initiative stands for."

And while a few commission members criticized the citizen-lawmaking process as a clumsy way to do the state's business, most spoke in favor of the open space proposal.

At least this initiative comes with a funding source, said Utah Tax Commissioner Bruce Johnson. "If the people of this state want to impose a tax on themselves for this purpose, who are we to stand in the way?"

kstewart@sltrib.com