Legislative leaders eye constitution change to use education funds to pay for other state needs, Robert Gehrke reports

Proposal could significantly change an educational earmark that has existed since 1930 — but could also get rid of the sales tax on food

(Francisco Kjolseth | The Salt Lake Tribune) Robert Gehrke.

Utah lawmakers are looking to once again divert money from public education and potentially eliminate a provision in the Utah Constitution that earmarked income tax revenue for public schools for nearly 92 years.

In the process, lawmakers may eliminate the sales tax on food — a top priority for advocates for low-income Utahns.

House Speaker Brad Wilson and Senate Majority Whip Ann Milner briefed education leaders on the state’s budgetary problem and their proposed fix Friday. Several who attended the meeting described the reception as anywhere from chilly to “mixed.”

Legislative leaders hope to make their proposal public early next week as the Legislature heads into the closing days of the 2022 session, meaning lawmakers will have to move fast — likely a strategic move so opponents don’t have time to mobilize against it.

Here’s the crux of the issue: Despite announcing Friday that the state has a surplus of more than $800 million, about 70% of that money comes from income taxes.

Those income tax dollars have been earmarked for public schools since 1930. In 1996, higher education was added to the Education Fund.

All other state services were paid for out of sales tax revenue, known as the general fund, which wasn’t growing fast enough to meet the demands for state services. So in 2019, lawmakers passed a constitutional amendment, ratified by voters the following year, allowing income tax revenue to be spent on social services for children and those with disabilities.

Lawmakers won the support — or at least prevented opposition — from the education community by promising annual inflation-adjusted increases for education.

But Amendment G, as it was known, didn’t solve the problem and now legislative leaders say they need even more flexibility.

This sounds like a lot of accounting jargon, but it boils down to this: Getting that flexibility will mean another Constitutional amendment, diverting more money from education and perhaps eliminating the earmark entirely.

Failing to do it, Speaker Wilson said in a statement Friday evening, could “limit funding for important needs such as programs for seniors, public safety, mental health, air quality, and more.”

“To allow the state greater budget flexibility, remove the state sales tax on food, and continue prioritizing education funding with additional guarantees, lawmakers are working with education leaders to determine the way forward,” Wilson.

Utah Education Association Heidi Matthews said the teachers union’s commitment is to making sure students have the resources they need, regardless of where the money comes from, but details of the proposal are needed.

“Any proposed changes to the Utah Constitution require significant study and reflection of both intended and potentially unintended impacts on our schools,” she said.

A handout obtained by The Tribune describes the proposal as “removing artificial barriers” while “continuing to prioritize education funding.”

Utah State Board of Education Chairman Mark Huntsman said the board needs to understand the details of the proposal before it can take a position. He has scheduled a board meeting for Tuesday morning where they will be briefed on the specifics.

The draft proposal outlines what public education would get: increased inflationary adjustments to the state’s per-pupil spending formula, paid professional time for teachers, funding for supplies and materials, and a Public Education Rainy Day Fund to “ensure stable funding for public education, even in economic downturns.”

Frank Schofield, the superintendent of the Logan School District, said it was presented as a change to the Utah Constitution to open up flexibility and some statutory language to include ongoing funding.

“The first set of ideas they shared really was, as they expressed it, a starting point and they don’t know what the final product needs to look like,” Schofield said.

Some of those in attendance expressed concerns about removing the constitutional guarantee for public education as schools are facing challenges with recruiting and retaining teachers, improving facilities and ensuring the mental and emotional health of students.

Eroding state funding could also shift more of the burden to local school districts.

The proposal to divert education dollars to other purposes comes as lawmakers are considering HB331, the “Hope Scholarship Program,” which would take $36 million out of public education funding to award as vouchers for parents to send their kids to private schools or to pay for tutoring, online courses or other school fees. Gov. Spencer Cox has said he would veto that bill until he is comfortable schools are being adequately funded.

Earlier in the session, lawmakers passed and Cox signed a nearly $200 million income tax cut — money that otherwise would go to education and could have meant a 5% increase to the state’s last-in-the-nation state per-pupil spending.

“The many negative education bills proposed this session caused considerable distraction, to say the least — especially to our teachers and educators,” Matthews said.

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