Now that the Utah Legislature’s Task Force on Tax Restructuring and Equalization is conducting its post-hearing examination of Utah’s tax structure, the Utah Citizen’s Counsel urges citizens to closely monitor the options under consideration.
UCC has been studying Utah public education financing and concludes that legislative removal of the income tax earmark would be a serious mistake. The income tax was earmarked exclusively for public education in 1946, protecting public education as the long-term, prime responsibility of state government.
The earmark is under legislative reconsideration at a time when investment in a quality education for Utah’s children has never been more important to meet national and international challenges. Moreover, financial analyses by the Utah Foundation and the former chief economist for the State Tax Commission, Doug MacDonald, reveal that tax revenue for public education has steadily eroded over the past 20 to 25 years. The revenue loss has reached an average of well over $1 billion annually. What is primarily responsible for this dramatic drop?
1. A 1996 constitutional amendment, allowing higher education to receive income tax funds that were formerly designated solely for public education;
2. 2007′s flat 5% income tax rate and subsequent income tax amendments that have generated significantly less revenue than the previous rate structure; and
3. Cuts and rate adjustments to the state’s basic school property tax levy.
Lost revenue from these sources was exacerbated by 2007-2009's recession.
Reduction in Utah’s effort per taxpayer to fund public education produced a drop in state rankings from seventh (1995) to 37th. Our effort per taxpayer has seriously lagged, and per-pupil spending has been last among the 50 states for years.
UCC recognizes that Utah has had an above average birthrate and a large, growing school population — a serious responsibility for Utah taxpayers. If, however, we had met that responsibility with the same effort to fund public education as in the mid-1990s, we would have had more than a billion additional dollars annually for many years to enable more progress in teacher salaries, auxiliary support services (nurses, social workers, counselors, psychologists, etc.), class size reduction in key grades, targeted interventions for at-risk students, and (more recently) implementation of high-quality preschool services for 3- and 4-year-olds. Instead, we let those opportunities slip.
Resultant student achievement is not as good as many Utahns think. It is comparatively good because 75% of our K-12 students are white, compared to the national average of 60%. Yet, when evaluated for college readiness, less than half Utah’s 2018 graduates met benchmark college readiness in math, science and reading. Compared to other states, Utah’s 2015-2017 high-school graduation rates look good until broken out by ethnic group, and then are actually a little below the national average for each group, including white students.
Also, although our national 4th- and 8th-grade reading and math scores have been rising to average or above, those scores reveal large discrepancies when broken out by income and native language. English learners and children from poverty households are markedly below the average. Do we really want to allow this wide gap to remain and have thousands of Utah’s future adults lagging far behind in high school graduation and college and career readiness? Shouldn’t we strive to get underserved students kindergarten-ready — a key indicator of future educational achievement and post-high-school success?
Legislative funding increases for public education in recent years have barely kept up with student growth and inflation. They have not significantly funded effective ways to increase student performance. Although tax earmarks reduce legislative flexibility and can be a bad idea, we believe that the education earmark must be preserved. No legislative promise to sustain current efforts absent an earmark would be sufficient to meet future needs, and no future Legislature could be forced to honor such a promise.
The Legislature must protect the investment in the state’s most precious resource — our children. We suggest that, in re-examining Utah’s tax structure, the Legislature should focus on appropriately balancing increases in sales and use taxes and eliminating no-longer-justified tax exemptions. These are superior ways to address Utah’s important social service needs.
Submitted by Dixie S. Huefner, former special education professor, University of Utah; John Bennion, former superintendent of Salt Lake City and Provo school districts; Julie Miller, former principal in the Salt Lake City School District; and Sheryl Allen, former member of Utah House of Representatives and former president of the Davis Board of Education