Senator Jerry Stevenson says the renaming will better reflect the Utah budget.
The Byzantine budget process in Utah can be a bit confusing. The state constitution stipulates that corporate and individual income taxes fund public and higher education. Some social services were added to the constitutional appointment in 2020. The rest of Utah’s tax revenues support everything else in the state budget.
Simply put, the Education Fund is for educational purposes, and the General Fund is for everything else.
Senator Jerry Stevenson, R-Layton, is proposing SB211 rename the Education Fund into the “Income Tax Fund”. He explains that the name change is needed to better explain how the state government is funded.
“Due to recent changes that allow income tax to fund children and people with disabilities, while maintaining protection, growth and stabilization of public education funding, we felt it was necessary to update the title to accurately reflect the changes,” Stevenson said in a text message. .
Changing the name of the fund to reflect where the money comes from, rather than what lawmakers are required to spend it on, may make it a little easier to make some budget decisions.
Most of the money in Utah’s last budget surplus came from the Education Fund. These surpluses are due to higher-than-expected income tax levies. Having large sums of money in accounts designated for education, and spending it on things other than education, can lead to some difficult issues for lawmakers.
For example, lawmakers quickly passed a $ 200 million income tax cut, paying for the tax cut with money earmarked for public and higher education. That $ 200 million is equivalent to a 5% increase in funding per student. This can be difficult to justify if the state is at or near the bottom of how much states spend on education. Reducing the tax from the Income Tax Fund is much easier to sell to the public.