For the past few years, I have written an annual pre-session article discussing the state budget and various hot button issues. The budget news for the past few years has been depressing by even the most generous of standards. Even though I think the state did a great job making wise budget decisions during trying times, it didn't make it any easier to be the bearer of bad news in articles about the budget.
This year the opening budget news is positive! The projections are checked and revised throughout the year, but for several quarters the estimates have continued to move in a positive direction. Early estimates show state revenues up by $400 million over last year ($128 million from one-time revenue sources and $280 million from ongoing sources).
After spending so many years pinching our pennies, this revenue growth feels like a windfall. We have deprived ourselves for so long, we will have to fight the urge to splurge and spend the money with abandon. The reality is we have many areas of need and the new revenue must go to address those issues before we consider any more exotic spending ideas. For instance, 12,500 additional school children will be entering public school next fall and some of the money should be used to offset the growth in the Public Education budget for these students. We must consider how best to address $52 million in structural deficits from last session caused by funding on-going programs with one-time funding during the worst of the recession. The state is also nearing its bonding cap.
The additional $128 million in one-time funding could be applied toward building and road projects so as to preserve room within the bonding cap for future projects. We also need to consider replenishing our rainy day funds, which were depleted during the recession.
As you can see, the needs for funding line up quickly. In just a paragraph I outlined four items that could consume nearly all the revenue growth. If we have learned just one thing from the Great Recession, it is fiscal responsibility. A state budget is no different than a family budget. The scale might be larger, but the same principles apply. The best guarantee against future economic crisis is to ensure our budgets are sustainable. I believe our fiscal priorities for the 2012 session should be to:
* Manage bonded indebtedness and increase Rainy Day Fund reserves (the state's family credit card and savings account)
* Eliminate structural imbalances (paying the mortgage with the Christmas bonus)
* Invest in critical infrastructure (fixing the roof before a storm tests the old shingles)
* Develop strategies to become self-sufficient and less dependent on federal funds (making sure we can stand on our own without bailouts and the strings they bring)
It will be hard to hold to these fiscally conservative principles. The line of programs hoping to be restored to pre-recession levels is long. If ever there was a time to ensure we get it right and apply the lessons learned, this is it. The fiscal shape of our State sets the tone for our personal fiscal wellness. We have only to look to neighboring states to see the impacts a state in fiscal disorder can have on the individual.
I invite your feedback and participation in the legislative process, especially during the session. I will be hosting Town Hall Meetings on Wednesday, Feb. 1, at Bonneville High School from 6 p.m. to 7:30 pm and at South Weber Elementary from 8 p.m. to 9:30 pm. Please come and give me your input on the important topics that will come before the Utah Legislature this year.
Brad Dee is the House majority leader. He represents House District 11, which covers portions of Davis and Weber counties.
Comments