DALLAS - Utah lawmakers will open a special session tomorrow with plans to cut spending by $272.4 million and to approve issuance a $150 million of general obligation bonds for highways.
Gov. Jon Huntsman called the session after revenues had fallen short of projections amid the economic downturn. The governor's office said the falling revenue include income and sales taxes.
"While Utah is seeing the impact of the national economy, our sound financial policies and practices have put the state in a fortunate position of being able to deal with this downturn in our revenue with a balanced approach," Huntsman said in calling the session. "We continue to demonstrate why Utah is the best-managed state in the nation by this proactive approach to dealing with Utah's budget. It's critical to realize our state is still performing."
Huntsman is calling for 3% cuts in state agency spending but is exempting education. The $13 billion budget grew by about $600 million in the regular session last spring.
The Revenue Estimates Committee, made up of representatives from the executive and legislative branches, met Monday to revise fiscal year 2009 revenue projections, decreasing it by $272.4 million, leaving a remaining surplus of more than $330 million in new money for this fiscal year. The Legislature's Executive Appropriations Committee will meet tomorrow to adopt the new numbers.
Issuance of $150 million of bonds for highway and transportation projects would allow the triple-A-rated state to use debt for projects instead of paying out of annual appropriations. Huntsman did not specify how much debt he would be willing to accept.
Additional money could come from a $100 million fund the Legislature set aside in anticipation of a slowing economy. The state also maintains a $400 million rainy-day fund.
Last week, Utah reported its worst employment figures in five years but drew some encouragement from tame inflation. The Utah Department of Workforce Services said overall employment rose only 0.3% in August over the same month in 2007. The addition of 3,260 jobs was the lowest monthly employment growth since August 2003. The biggest gain, of 5.4% and 54,000 jobs, came in June 2006.
As job creation weakened, inflation did as well, helped in large part by falling fuel prices, officials said.