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Gehrke: Taking money out of Utah’s underfunded schools is not the way to solve the tax problem

Robert Gehrke

It shouldn’t really come as a surprise anymore. Last week, the Census Bureau released its latest numbers on how much each state spends educating each of its students and — you’ll never guess — but Utah was last.

It’s been that way every year, pretty much since Utah kids have been going to school. Chances are it will be that way every year until this year’s kindergartners have great-grandchildren in the school system.

As a state, we have a lot more kids than most, but it remains a dubious distinction to be last in the nation.

Still, let’s give credit where it’s due: The state has been plowing mountains of money into schools in recent years, injecting $1.1 billion in new money over the past four years, according to the governor’s office. It has barely made a dent in Utah’s standing, but it is a substantial sum.

And part of the reason lawmakers have taken that approach, with some grumbling along the way, is that since 1946 all of the money the state collects from income taxes has been earmarked to schools. For 50 years, that meant just K-12, but voters approved an amendment in 1996 that expanded it to colleges and universities, too. The economy has been strong, so that has meant schools have received lots of new money.

It’s possible that will change.

Later this month, a special task force will hold its first of eight scheduled public meetings around the state with the goal of overhauling Utah’s tax system and one of the proposals being suggested by some legislators is changing Utah’s Constitution to get rid of that education earmark.

Sen. Curt Bramble, R-Provo, has opened a bill file to do just that because, he says, legislators have used it “as a dodge,” instead of answering directly to voters about how they spend taxpayer dollars.

“Every state that is at the top in per pupil spending doesn’t have an earmark. Let’s stop the charade and let education claim its rightful place in the budget,” he said. “The reason I’m doing it is to get [the idea] out there and get the public discussion going. I wouldn’t want to do it in a vacuum.”

Sen. Dan McCay, R-Riverton, is taking a different approach. Last session, he proposed a constitutional amendment that would let lawmakers spend income tax revenue on social services (the second largest part of the state budget) in addition to education. His proposed amendment didn’t get a vote in the House, but he said it should be on the table.

“I think it has to be,” he said. The point of earmarking the education money is to make a statement that schools are a priority. “The thing we ought to be asking ourselves now is: Do our social services programs deserve the same attention?”

Both senators say their proposals won’t take income tax money away from schools.

But one thing is certain: Neither idea will mean MORE money for education. And logically, the only thing legislators gain from amending the Constitution to remove the earmark is it unties their hands to spend income tax money in other areas.

Instead of having a guaranteed stream — or in good times, a river — of revenue, schools will compete with every other program and ultimately at the mercy of a sometimes fickle Legislature.

In an ideal world, that might work. Voters could hold lawmakers accountable if they aren’t satisfied with the way schools are funded.

But we don’t live in an ideal world. We live in Utah where about one in 20 races are competitive in any given election year, so the accountability to voters is almost nonexistent.

That said, the lawmakers are not wrong: Utah has a tax problem.

The sales tax collected in the state isn’t growing fast enough to keep up with demands for social services, public safety, courts, roads and everything else it once paid for. That’s because our economy has shifted from buying things to buying services — car washes, accountants, Lyft rides, cosmetic surgeries, haircuts, real estate agents, lawyers.

Gov. Gary Herbert and the Legislature initially wanted to start taxing those services to pay for other parts of the state government. But naturally that met with huge opposition from the doctors and lawyers and accountants and Realtors who would be taxed — who also happen to be well-connected and have very good lobbyists.

It still remains the best option to fix the problem, but maybe not the only option.

Perhaps, go back to the way the tax system was structured when the income tax was instituted in 1931. Back then, 75% was dedicated to schools, leaving lawmakers 25% to spend on whatever else they needed, including higher education.

Maybe the answer is to follow the lead of other states and put more of the burden of paying for education on the property tax than we do now.

Any of those options will come with a high political price.

But really, the only way it makes sense to rewrite the Constitution to take away the guaranteed education money is if you absolutely trust legislators to do right by our schools.

And, frankly, I do not.