Education receives 72% of all new money in governor's budget

Kaysville • With a healthy economy, the state estimates that it will receive an extra $382 million in ongoing tax revenue next year — and Gov. Gary Herbert proposed Wednesday to spend 72 percent of it on education.

“We’re going to be spending a lot of money in education,” Herbert said. “It’s my top budget priority. It always has been since I’ve been governor, and it will continue to be.”

His new $16.7 billion budget proposes to spend $275 million more in ongoing money on education — with $208 million for grades K-12 and the rest for higher education. The total budget for education is $9 billion.

That extra money includes an increase of $170 million in flexible local school money distributed to school districts through what is called the weighted pupil unit (WPU), based on how many and what types of students each district has.

Herbert called for an add-on to the WPU to include an extra $34 million to help districts with more children at risk of academic failure, “making sure those districts have the funding they need to hire more teachers, special ed training or counselors — whatever they need to help these kids be successful,” said Kristen Cox. executive director of the Governor’s Office of Management and Budget.

The budget also includes $36 million to cover the added costs of what are projected to be another 7,700 public school students next year.

It includes $25 million for property tax equalization among school districts. “You should be able to get as good of an education in Bluff, Utah, as you get in Bountiful, Utah,” Herbert said, and such equalization helps ensure that.

The governor’s numbers are similar to the budget priorities requested by the Utah Board of Education. School board members are asking for $165 million in WPU funding — compared to the governor’s $170 million combined for per-student spending, at-risk funding and tax equalization — and more than $33 million to address enrollment growth.

School board members have also requested $18.5 million for elementary reading programs, $5 million for busing, $4 million for classroom supplies and $12.5 million for school-technology upgrades. The governor recommended $1 million for classroom supplies in his budget, but did not include the board’s other priorities.

Higher education

For higher education, the budget calls for an extra $35 million for compensation increases of professors and other employees.

Historically, 75 percent of such pay increases came from tax revenue, and 25 percent came from tuition increases. However, $8 million of the proposed increase seeks to avoid such mandatory tuition bumps.

That “is to try to keep tuition costs as low as possible for students,” said Phil Dean, Herbert’s state budget director. Cox added, “We don’t want to price students out.”

The budget also proposes an extra $24 million for the Board of Regents to use at state universities and colleges according to their priorities.

Herbert is also declaring 2018 as the “year of technical college education” and chose to unveil his budget at Davis Technical College in Kaysville to underscore that.

Herbert said his budget proposes an additional $9.5 million total for technical education. “That’s nearly a 10 percent increase,” he said.

At a technical college, “You spend a little less time in school, it’s a little less expensive, you owe less debt, and you can get in the marketplace and find rewarding careers,” Herbert said. “Nearly 90 percent of the graduates of our technical colleges are placed immediately into jobs. So if you want a job, come to a technical college.”

He also announced Davis Technical College would receive a new $34 million building to handle health education for programs, including those for nurses, dental assistants and surgical technicians.

Tax reform

Herbert’s spending plan includes no proposed tax hikes or increases in state debt. But he is encouraging legislators to consider tax-reform measures.

For example, Cox said the state now uses its general fund and sales taxes to subsidize many programs that could be paid through user fees — such as highway costs that could be funded with higher gasoline taxes, or water projects that could be funded with higher water fees.

“RIght now, 55 percent of the cost of roads and maintenance comes out of the general fund,” said Herbert. “Only 45 percent comes out of gasoline tax. That’s probably backward.”

The governor is proposing a small pilot study to experiment with having people pay tax based on how many miles they drive, instead of how much gasoline they buy. It could lead, he said, to fairer taxation of electric and hybrid vehicles that now escape taxation.

Also, Cox said that before the state subsidizes new water projects, it would like to ensure that those who would benefit are paying appropriate fees for what they consume. “We don’t think folks with low user fees should be getting subsidies from folks with high user fees,” Cox said.

Herbert also proposes to broaden uses of the state’s $600 million a year Transportation Investment Fund. Currently, it may be used only to expand highway capacity. Herbert would like to allow it to be tapped for any transportation projects, including mass transit — which may help reduce air pollution.

In addition, the governor urged the Legislature again to erase earmarks it has put on different types of tax revenue, saying, “39 percent of all the new money that comes into the general fund has already been earmarked” and no debate is now allowed about competing spending needs.

Legislative reaction

House Speaker Greg Hughes, R-Draper, and Senate President Wayne Niederhauser, R-Sandy, praised the main priorities that Herbert outlined — and predicted that final appropriations bills may closely mirror them.

“In the Senate, we would align pretty close with spending that kind of money on education. That’s where it needs to go,” Niederhauser said. “We were planning on that even before we saw his budget. When you have a good year, you need to put more money into that.”

Hughes praised the heavy emphasis that the governor put on education, his continuing support for Operation Rio Grande and proposals to add more flexibility to transportation funding to possibly help mass transit with state funds.

“Those are the things that have been weighing on my mind,” Hughes said. “I like what I see. I think it’s a good budget.… It shows us where the priorities of each agency would be,” but he expects minor changes as lawmakers go through public hearings and debate.

Other highlights

Other highlights of the budget include:

• A previously approved $10 million for Operation Rio Grande, the effort to fight crime around downtown Salt Lake City areas frequented by the homeless, and to provide better services for them.

• $10.3 million to improve the state park system.

• A 2 percent cost-of-living pay increase for state employees.

• $5.9 million to improve Olympic venues, which may help bids for future Games. “It would help support and strengthen a potential bid,” and help maintain facilities, Cox said.

• $500,000 to conduct Utah-specific air quality research, and $350,700 for more air quality personnel in areas with heavy backlogs or unmet needs. Cox said the state also plans to push more telecommuting among state employees to reduce how much they drive, and possibly to open up more state jobs to rural residents.

• $8.4 million for dam safety upgrades.

• $305,000 to fight algal blooms in lakes and waterways.

• $1 million to study and better measure agricultural water use in the state.

• New buildings, including at the University of Utah hospital, a Weber State University social science building, a Dixie State performance building, a new Department of Agriculture building, and a Nephi National Guard Armory.