But a record-breaking $1 billion surplus nearly turned it into the session of tax cuts, stalemate and halfway measures.

A compromise between the Senate and the House, with the backing of Gov. Jon Huntsman Jr., guaranteed $160 million in tax cuts to Utahns - half of that by slashing the food tax paid by most Utahns by about 30 percent.

They also tried to open the door to a so-called income tax reform that the governor and legislative leaders argued is crucial to Utah's future. It didn't happen.

Income tax reform, a centerpiece of Gov. Jon Huntsman Jr.'s economic development strategy failed to pass after being bottled up in the House over fears it would hurt Utahns, including farmers, retirees and families saving for college.

"I'm not willing to throw out the window the social engineering we've put in over the years," said Rep. Ben Ferry.

"We are not ready to make this major leap," said Rep. Steve Urquhart. "Next year it will be in better form."

House members tried to amend the bill to put back a raft of deductions and credits, including the Utah Education Savings Plan, fuel credits for farmers, checkoffs for political contributions, totaling millions in voluntary donations.

In the end, it was set aside for other business and time ran out.

The Legislature followed through on its pact to reduce the state's share of the sales tax on groceries by 2 percentage points - from 4.75 percent to 2.75 percent. The kickoff date was pushed back to Jan. 1, 2007, to give retailers time to prepare. And the lawmakers threw in $6 million to help them with software and equipment.

But even that was not without reluctance in both houses.

Sen. Tom Hatch argued it was bad tax policy to narrow the sales tax base and it would have some unintended consequences. "We are putting a lot of small mom and pop groceries out of business. This is a convoluted system that is going to be very hard to understand."

Sen. Parley Hellewell voted against it, saying, "This is very bad tax policy. It's going to hurt a lot of people. We will be back to change it."

Rep. Gordon Snow and other House members thought the $6 million might not be enough, considering the tax changeover could cost small groceries stores in rural areas from $4,000 to $30,000 in hardware and software costs and the state would only cover half. "That appears to be a huge penalty on small grocery stores," Snow said. "We are asking them to carry half the cost to do our business."