Utah state legislators are preparing their committee budgets for the next fiscal year with an eye on cuts to accommodate the effects of Covid 19 on our state’s revenues.
“The revenue right now for income tax, and for sales tax is plummeting. We have no idea how far it's going down, when it's going to end, where it's going to be. We’re just kind of taking a guess as we’re watching the free-fall right now,” said Senator Lyle Hillyard, the republican who represents Utah's 25 Senate district.
Hillyard said legislators are preparing for several budget scenarios.
“And so what the executive appropriations have told us as chairman of the public education committees is disregard all appropriations we made last year," he said. "That money is not there. And then we've been asked to prepare a kind of a list of what we would change in our budget, if we end up having 2% less revenue than we had last year, 5% or 10%.”
Senator Hillyard said the dramatic impacts of the virus on the state budget are amplified by the changes to tax collection this year.
“Normally, income tax is paid on the 15th of April, but because of COVID-19 it’s not due until the 15th of July. We have a fiscal year that ends June 30th," Hillyard said. "So we had a special session earlier this year and we took money out of rainy- day funds and stuff to put in, but on the other hand, it means when the new revenue comes in July, the 15th, we're gonna have to fill back in those rainy-day funds as best we can.”
The senator said legislators are not currently considering tax increases to cover the deficits that Covid 19 has caused in the state budget, but some programs will see significant budget cuts.
“As the board, we will appropriate by program, some programs may be completely cut out, some may be able to take a 10% cut and others may be a two," Hillyard said. "And some if you do even a 2% cut, you may destroy the program.”
Base budgets are generally finalized by the end of March before the fiscal year begins, but the appropriations committee asked for budget revisions to be presented at a special session in June.
