A group headed by a conservative former legislator is attempting to give voters the chance to reject the new tax reform package that passed in a special session last week.
Former Rep. Fred Cox, R-West Valley City, filed papers Monday with the lieutenant governor’s office to start the process to gather signatures. It potentially could block the bill from taking effect until voters decide whether to repeal it in November’s general election.
But Cox and supporters face a herculean task: They must gather at least 115,689 signatures by Jan. 21, said Justin Lee, state elections director. The group also declared they will do it without paid signature gatherers.
Others who successfully pushed initiatives recently took a year to collect so many signatures and used paid gatherers.
“Legislators are not listening to the people,” Cox said. “Everyone else I’ve talked to — people I see at stores or work — are opposed to it. That’s the reason I’m running this.”
Among the five people who signed papers as official referendum sponsors was Gina Cornia, executive director of Utahns Against Hunger, who is upset that the Legislature is raising the sales tax on food.
“The Legislature had other options beyond raising the sale tax on food,” she said. “We signed because we support the voters’ right to have a say on this. I don’t think leadership and the task force [that studied reform options] took seriously the concerns from the public.”
Cornia added, “We have some heavy lifting ahead of us” to gather signatures. “But this is a way to send a message that leaders need to listen to the public.”
Cox set up a Facebook group called 2019 Tax Referendum where people can volunteer to gather signatures. As of Monday afternoon, it had 3,000 members — more than doubling after papers were filed earlier in the day.
“If we could get 2,500 people to each gather 50 signatures," Cox said, "we’re there.”
Signatures by law must also come from at least 8% of registered voters in 15 of the state’s 29 counties, Lee noted.
Cox said when he was a legislator, he fought earlier attempts to tax food sales at the full rate charged on other items — and that is a main reason he is pushing the referendum now.
“Individuals who are not doing really well — but are making it without any government help — are basically getting thrown off the bus," he said. “And that whole attitude bugs me.”
Cox said he found through the years that too many lawmakers do not realize the impact sales tax hikes have on the poor and lower middle class.
“You walk in the store with $3 and you look at a can of chicken and a bottle of milk. Depending on how much tax is, you may not be able to buy the chicken,” he said. “They don’t understand that.”
He’s also upset at proposed gasoline tax increases and changes that could lead to higher local property taxes for education.
“The combination is going to hit people very hard,” he said.
Another sponsor of the referendum is Judy Weeks Rohner, a former school board member in the Granite School District.
She said the referendum group “is not just an organization that is going off crazy. People are upset that the food tax is going up, gas taxes are going up, they are taking money from the education fund…. I am just a citizen who has had enough.”
Cox said the group decided not to use paid signature gatherers “in part because I don’t have thousands of extra dollars laying around,” and because of complaints in some past campaigns that they used confusing tactics to get signatures.
He said he is also finding support from both conservatives and liberals who are upset about portions of the tax changes. “Liberals don’t like what happened to education,” he said. “We have people who aren’t accustomed to working together, but I’m encouraging them to get along on this.”
The tax package passed last Thursday on votes of 43-27 in the House and 19-7 in the Senate. It fell short of a two-thirds majority that would have allowed the package to take effect immediately, essentially making it “referendum-proof.” Instead, it now takes effect 60 days after passage — unless referendum supporters can gather enough signatures by Jan. 21 to put the matter on the ballot next year.
Republican legislative leaders say they doubt the referendum will have much success, while Democratic leaders hope it does.
“Anyone who wants to do a referendum can, but it would do away with a $240 million tax cut,” said House Majority Leader Francis Gibson, R-Mapleton, who is co-chairman of the tax task force. He said the package will bring $160 million in ongoing tax cuts, plus $80 million of one-time cuts.
“We worked hard to do a tax cut that will benefit all Utahns, and much of it is front loaded” with “prebates” that will send checks next year to most Utahns whose household income is less than $70,000, he said. When people hear that, he doubts the referendum will do well.
Senate President Stuart Adams, R-Layton, added that he believes overall tax cuts in the package will be popular. “When people understand what we did, they will support it,” he said. “I think we have listened, and that we have done the right thing.”
House Democratic leader Brian King, of Salt Lake City, said, however, "it’s a bad bill, and I would love to see Utahns have the opportunity to weigh in” through a successful referendum.
He said gathering so many signatures in just a few weeks is nearly impossible. “Other groups have tried for far longer period to gather signatures — six, eight, 10 months — and have struggled. It’s a very steep climb.”
Still, King added, “I have found very little support for these outside of lobbyists and state agencies” and said he believes taxpayer opposition is high.
The new bill cuts Utah’s income tax by roughly $630 million, according to legislative estimates, through a reduction in the income tax rate, an increase to the per-child dependent exemption and the creation of new tax credits.
It also raises the sales tax by $475 million, primarily by increasing the tax on grocery sales and adding new taxes to the sale of motor and diesel fuels, resulting in an overall tax cut of $160 million.
One of the last changes made to the tax bill is a system of preemptive rebates — or “prebates” — that will result in two rounds of checks mailed out to Utah taxpayers, first in the spring and then again in the summer.