SALT LAKE CITY — Republican legislative leaders and GOP Gov. Gary Herbert settled their final budget issues Tuesday, and public education will take a small reduction next fiscal year.
House Republicans originally didn’t want the largest segment of state spending — public schools — to take any cuts.
And Herbert didn’t, either.
But Republican senators were adamant that schools should at least take a small hit, considering that they have more or less been held harmless this year and next, while some other state agencies and programs have been cut 10 percent to 15 percent.
The initial deal worked out Tuesday called for a 1 percent cut or $21.1 million. But $6.3 million that was to be cut from public school transportation — the buses that take kids to school and to special activities — will be restored.
Money to cover the cost of adding the busing back in the budget is expected to come from the tobacco tax increase initially opposed by Herbert.
GOP House members talked about taking the $6.3 million from tobacco settlement money that comes into the state each year. In fiscal 2010-11, that tobacco money is around $17 million, GOP leaders said.
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But the $1-per-pack increase in the cigarette tax already approved by both the House and the Senate would take effect May 1, two months before the new budget year begins.
That means the tax increase, expected to raise $44 million annually, would add more than $7 million to state coffers in May and June. While the governor had threatened to veto the tax, Monday’s deal all but ensures he’ll sign the bill.
So Herbert actually takes budget hits in two areas — he didn’t want an increase in the cigarette tax and he didn’t want public education cut.
Now, both of those items will be included in the 2010-11 budget bills that will be passed before the Legislature adjourns at midnight Thursday.
“It looks like we have an agreement on the budget that has addressed the governor’s key issues,” Herbert’s chief of staff, Jason Perry, said. “It has been great to see how well the House, Senate and the governor’s office have been working together to meet the needs of the state.”
Herbert is expected to announce his support for the tax increase on cigarettes when lawmakers finalize the public education budget Wednesday.
GOP legislative leaders were relieved to have resolved the only remaining major issue left this session.
“We’re done,” House Speaker Dave Clark, R-Santa Clara, said after leaving a meeting with the governor and Senate leadership. “The governor has signed off.”
Senate President Michael Waddoups, R-Taylorsville, said the mood in the meeting with Herbert was upbeat. “We congratulated each other,” the Senate president said.
However, he tempered his enthusiasm for cutting the public school budget.
“It had to be done,” he said after presenting the agreement to his closed GOP caucus early Tuesday evening.
But there was some grumbling by lawmakers.
“Why send a message that we cut public education?” Rep. James Dunnigan, R-Taylorsville, said during an open caucus of House Republicans.
Whether that cut is 1 percent, as originally sought, or less, Dunnigan said the message is still sent to residents who put public education funding as their top priority.
“I don’t think we need to do so,” he said. “We have other sources of money.”
Herbert and leaders have already decided that no new money would go to schools next fall. Thus, the estimated 11,000 new students already aren’t being funded.
That would automatically reduce the state per-student funding formula by around $90 per student, or a 4 percent reduction from what schools would see in a normal budget year.
Rep. Roger Barrus, R-Centerville, pointed out last year schools’ budgets were cut back $293 million, then legislators backfilled all of that money from one-time sources.
This year, school advocates hoped that hole would, again, be backfilled with one-time funds.
“We did more than that,” House Budget Chairman Rep. Ron Bigelow, R-West Valley, said. “We backfilled with ongoing revenues” so schools wouldn’t face, again, huge budget cuts a year from now.
Considering that, said several House Republicans, school administrators, teachers and parents should be delighted with just a small reduction to a budget that exceeds $1 billion already.
By Bob Bernick Jr. and Lisa Riley Roche, Deseret News
March 9, 2010