From a $1B surplus to fights over initiatives, here are five things to keep in mind as Utah’s legislative session starts

Utah’s annual legislative session kicks off Monday, and state lawmakers already have a lot on their plates: The governor has asked them to take on tax reform, they have a large budget surplus to manage, and there are scores of bills on the docket.

Even the routine parts of session will be new to the two dozen representatives and senators who are recent arrivals to the Legislature.

“We’ve got about 20 new members, the largest freshman class we’ve had in a really long time," incoming House Speaker Brad Wilson said. “That’s a good thing.”

The Kaysville Republican acknowledges that there’ll be a learning curve but says the payoff is having new voices in the policymaking debate.

“It does create a different dynamic,” he said.

In other words, this session could deliver some surprises.

Here are five things to keep an eye on over the next 45 days:

Prop, goes the weasel

In November, Utah voters approved three ballot initiatives by a majority popular vote — legalizing medical marijuana, fully expanding Medicaid and creating an independent commission to create and recommend new voting maps during the redistricting process.

By December, the marijuana initiative had been replaced in a special session of the Legislature, and supporters of the remaining initiatives — both of which were opposed by legislative leaders — are bracing for further efforts to tinker with or undermine the will of the public.

Supporters of Proposition 3 — the Medicaid initiative — plan to rally at the Capitol on Monday in opposition to bills that would either repeal Medicaid expansion or significantly roll back the initiative with enrollment caps, work requirements and potentially tightening the income threshold for beneficiaries.

“What they’re looking at would be a repeal of what the voters have passed,” said Danny Harris, AARP Utah advocacy director. “We’re not opposed to fixing any errors or anything that may come up. We are concerned about putting in unnecessary barriers to coverage or delaying that coverage.”

An updated analysis released this month by the Governor’s Office of Management and Budget estimates that the sales tax increase incorporated into Prop 3 will fall $10.4 million short of the cost of Medicaid expansion by 2021, and $64.5 million short by 2024.

Senate President Stuart Adams, R-Layton, said that maintaining full expansion long term could leave the state with two options: Cut funding from other programs or further raise taxes.

But he added that the conversations around Prop 3 do not include lowering the qualifying income level to those earning 100 percent or less of the federal poverty line, as Sen. Allen Christensen, R-North Ogden, has suggested his bill could do.

“There’s a desire to cover the 138 percent [poverty level],” Adams said. “I think we’ve heard the voters. They voted, and we’re going to do our best to respect it.”

Harris pushed back on the new cost estimates by the governor’s budget office. He said it was unclear whether savings under Medicaid expansion had been appropriately considered, because reduced health-care expenses could be built back into supporting the expanded program.

And while there may be a need for future discussions of how best to manage the state’s Medicaid program, Harris said the public has clearly endorsed an expansion, which will take effect in April if lawmakers do nothing.

“We have enough money through the initiative to fund Proposition 3 through the first year or two and possibly more,” Harris said. “The state just needs to honor the will of the voters and move forward with it.”

In addition to potentially altering the initiatives that passed in November, several bills are proposed to change the process of placing an initiative on the ballot. Among the changes under consideration are a delay in the implementation of successful initiatives and a consistent deadline to submit petition signatures and to remove signatures from a petition.

Money, money, money

Budget forecasts for the coming year contained some eye-popping numbers, with estimates that state leaders could have a $1.2 billion surplus on their hands. But so far, policymakers have been regarding this hulking money projection with a degree of suspicion.

Rep. Bradley Last, who heads the executive appropriations committee, says only about half that amount is actually in state coffers, and the rest of it is forecast revenues that may or may not come in as expected. There’s some discomfort because the state’s anticipated intake is “above trend,” and legislators are unsure if the numbers are reliable or if some fluke is at work.

The 2017 federal tax changes are also complicating the analysis, since they caused some abnormalities as high earners rushed to prepay their income taxes in December that year.

Last, R-Hurricane, said lawmakers are accounting for this by subtracting about $300 million from the anticipated surplus. Combine that with the $235 million the Legislature has already allocated for prison construction and some other odds and ends, and lawmakers are left with an estimated surplus of roughly $650 million, Last said.

Given the uncertainty that this revenue spike is permanent, officials will want to spend it cautiously, he added.

“If we send money to public education or higher education, most of that money ends up in salaries, and it’s not like we can take that back,” he said. “So we need to be very, very careful about building ongoing expenditures into the budget."

Layered over it all, there’s the unknown economic and budgetary fallout from the federal shutdown. If government closures continue to cause problems, after the temporary opening announced Friday, lawmakers might have to discuss the feasibility of using state funds to prop up the school lunch program and other federal initiatives, Last said.

New blood

The 2019 session follows significant turnover in the leadership and general membership of the Utah House and Senate. That could mean a “steep learning curve” for many of the state’s lawmakers, Wilson said. “[There is] not quite as much institutional memory as, maybe, we’ve had in the past.”

Adams, the new Senate president, said he’s encouraged by the new faces on Capitol Hill.

“The new legislators and new senators coming in, they’re extremely talented,” Adams said. "They’re bright, and they’ve got enthusiasm. I actually look forward to a very great session.”

Past sessions have shown tension between the state’s legislative and executive branches, with lawmakers and Gov. Gary Herbert divided on issues related to the budget and the state’s election laws.

Herbert has stated that he will not seek re-election in 2020, potentially freeing him up to place greater pressure on the Legislature or to steer the spotlight toward and away from the candidates considering a gubernatorial run. Among the presumed 2020 candidates are former House Speaker Greg Hughes and Lt. Gov. Spencer Cox — a former member of the House — who has increasingly taken a public role on issues such as homelessness and Operation Rio Grande.

In a prepared statement, Herbert said that Cox has been a “tremendous asset” to the executive branch, who will be busier than ever during the upcoming legislative session.

“In addition to fulfilling his constitutional and statutory responsibilities,” Herbert said, “the lieutenant governor has been a great conduit of information working with the Legislature to help us come together to solve policy issues.”

Divine intervention?

To some people, the formation of Utah’s medical cannabis law was a perfect example of the outsized influence The Church of Jesus Christ of Latter-day Saints exercises in state politics. This complaint was even raised in a lawsuit filed against state officials who’d replaced the language of Proposition 2 — the medical cannabis initiative passed by voters — with a bill hammered out by legislative leaders, church representatives and advocates.

While the church doesn’t comment on most bills that come before the Legislature, proposals that touch on alcohol consumption or social issues can be another matter.

For example, now that the church has clarified that it doesn’t oppose strengthening Utah’s hate-crimes law, Sen. Daniel Thatcher, R-West Valley City, has renewed hope that he’ll be able to pass the legislation this year. Herbert also recognized the church’s opinion as a factor in the bill’s fate.

“The fact that The Church of Jesus Christ of Latter-day Saints evidently has weighed in on this and said they’re not opposed to it can’t hurt the possibilities,” he said Thursday.

The faith shared by nearly 90 percent of Utah’s Legislature could also come into play in the debate over Utah’s 3.2 beer law; some in the industry are pushing the state to allow higher-alcohol beer in Utah’s grocery and convenience stores because many brewers aren’t producing lower-alcohol beer anymore. But this change could be a tough sell to Latter-day Saints who adhere to a teetotaling lifestyle.

Bread and circuses

Each legislative session is peppered with hard-to-predict moments of comedy, controversy or political chicanery, like last year’s widely ridiculed “Fresh Prints of Bills Here” video, the heated debate over a proposed statue of historic Utahn Martha Hughes Cannon, or the social media uproar over a bill to name a southern Utah highway after President Donald Trump.

Many bills for the 2019 session have yet to be made public, but among the known proposals are efforts to criminalize the distribution and use of fake urine, to review and potentially update the state flag, to allow drivers to legally run a red light when traffic is extremely low, and to designate the Gila monster as the official state reptile.

Rep. Lowry Snow, R-Santa Clara, is sponsoring the Gila monster bill with the help of a group of seventh-graders in his district. He recently told The Salt Lake Tribune there could be some disagreement over which reptile deserves the honor of representing Utah.

“I’ve heard from a few folks,” Snow said, “who think it ought to be the desert tortoise.”