A Utah lawmaker is planning to cancel a tax hike for education, even if voters approve it


(Steve Griffin | The Salt Lake Tribune) Rep. Mike Schultz, R-Hooper on the floor of the House of Representatives at the State Capitol in Salt Lake City Friday February 2, 2018.

What do you call a tax increase initiative without a tax increase? If you’re Rep. Mike Schultz, R-Hooper, you call it HB299.

Schultz is sponsoring a bill that would, in effect, cancel out the Our Schools Now initiative’s effort to boost annual education funding by $715 million through a combination of sales and income tax hikes.

If Our Schools Now makes it to the ballot, and if the initiative is approved by voters, HB299 would then cut Utah’s tax rates back to their current levels.

“I think the public would like this,” Schultz said, “because who likes the largest tax increase in their state’s history?”

Schultz said he’s working with the organizers of Our Schools Now and hopes to reach a compromise that would allow them to abandon their initiative. The two parties, he said, are “not in the same place yet.”

But if lawmakers are able to prioritize funding for schools through existing revenue, he said, then the goals of the initiative can be achieved over time without a tax increase.

“I think if we can get the dollars there, that’s the most important thing,” Schultz said. “My whole goal with all of this is to work together and show everybody we don’t have to have a tax increase to accomplish the same things.”

Our Schools Now organizers have been critical of the Legislature’s incremental approach to school funding in the past, arguing that state spending has focused on keeping pace with the growth in student enrollment without providing for improvement.

Austin Cox, spokesman for the Our Schools Now campaign, said Friday that the initiative is willing to work collaboratively with lawmakers on the critical needs of schools. But Utahns are concerned about school funding levels, he said, and the will of the public should be respected.

“Lawmakers have set a very high bar for ballot initiatives in Utah,” Cox said. “If more than 110,000 [petition signers] express the desire to vote for better school funding, it would be tragic to undermine the most democratic of institutions.”


If voters approve the Our Schools Now tax initiative in November, this bill would cancel out the voters' action by reducing Utah state's sales and income tax rates back to their current levels. - Read full text

Current Status:

Filed Law Introduced in House House Committee House passage Senate Committee Senate passage Governor's OK

A recent poll by The Salt Lake Tribune and Hinckley Institute of Politics found that 56 percent of Utah voters support Our Schools Now, while 38 percent oppose the initiative’s tax increases.

Cox said the campaign is following the rules for citizen initiatives set up in state law, but lawmakers continue to “sow seeds of discord and chaos” during the lead-up to the November election.

“For them to do this on the heels of an additional public opinion poll, in a matter of days, just shows that we really do need the people to be able to vote on this if we want to see additional investment in teachers and schools,” he said.

Under Our Schools Now, schools would be required to create improvement plans before receiving supplemental funding from the tax increases.

Schultz said his bill maintains that same structure — with the expectation that money will be used for goals like teacher training and retention — albeit with funds pulled from existing pools instead of new revenue from a tax increase.

He said lawmakers have not yet received final revenue estimates for the year and that it’s too early to speculate on what funding will be available for education. But the Legislature has increased the education budget from $4 billion to roughly $4.8 billion over the last four years and Schultz said that growth is expected to continue.

“You’ll see, again, another big increase this year from the Legislature,” he said. “We can do this without the largest tax increase in our state’s history. I know we can.”

For years, Utah has ranked last in the nation for the amount of money it spends, on a per-student basis, educating children in public schools.

And educators say the bulk of annual funding increases approved by lawmakers each year is either absorbed by inflationary costs or used to hire and pay the new teachers required for the additional students who enter public schools.

Granite School District spokesman Ben Horsley said that in a typical year, little funding is left over for salary increases and other priorities.

“Growth in the state’s student population has taken the vast majority of this new funding,” Horsley said. “This has paid for new teachers teaching the estimated 40,000 new students in that time.”

Schultz said that lawmakers share the concern of educators and Our Schools Now regarding the state’s teacher shortage — most quit the profession in their first five years — and classroom sizes. But those problems won’t necessarily be solved by a tax increase that could hurt the state’s economy.

“We could double our income tax burden and we will still not solve the classroom sizes,” Schultz said. “We could pump billions and billions and billions of dollars into education and not solve it.”

The state lowered its income tax rate to the current level in 2007, which Schultz said helped Utah weather the Great Recession and position itself as one of the best economies in the nation.

By hiking the income and sales taxes, he said, middle- and lower-income Utahns would feel the greatest impact while the state as a whole would become less business-friendly.

“Utah’s economy before the Huntsman [Administration] tax cuts was OK,” he said. “I’m not going to say it wasn’t good, but it was not leading the nation.”

Our Schools Now is one of six citizen initiatives working to qualify for the November ballot. Senate President Wayne Niederhauser, R-Sandy, said on Friday that some of the initiatives, if approved by voters, may need to be adjusted and refined to align with state laws.

But an attempt repeal an initiative in concept, he said, would be difficult for lawmakers.

“I think, historically, it’s very problematic for the Legislature not to accept the will of the people,” he said.