Salt Lake Chamber Public Policy Guide Highlights Tax Reform, Education Funding
Salt Lake City—Education and tax reform were at the forefront of both the Salt Lake Chamber’s 2017 Public Policy Guide and the minds of legislators at a panel discussing the guide Wednesday.
Moderated by KSL’s Doug Wright, Salt Lake Chamber President and CEO Lane Beattie, Senator Jerry Stevenson and House Majority Leader Rep. Brad Wilson discussed lawmakers’ and the chamber’s top issues for this year’s session.
Each year, the Salt Lake Chamber releases a report informed by the concerns of the business community at large for perusal and consideration by lawmakers in the upcoming legislative session.
“It’s something that’s become very, very important to us as the voice of Salt Lake City’s businesses,” Beattie said. “The chamber utilizes this guide on a regular basis to promote policy.”
On the list is greater investment in education to help grow a skilled workforce; modernizing Utah’s tax code as part of solving future funding challenges—particularly for education; protecting non-compete agreements; supporting public-private partnerships; regulation reform; improving air quality; balancing alcohol laws; and creating a strategy to protect Utah’s water in the future. When Beattie was joined by Stevenson and Wilson to discuss the list, each item garnered discussion, but the first two items dominated the conversation.
Stevenson and Wilson’s comments regarding education were frequently directed at—though its name was not used—Our Schools Now, an initiative launched by a host of Utah business leaders who are striving to get it onto a future ballot. The initiative would raise income taxes by seven-eighths of 1 percent, which would total $750 million, or about $1,000 per student in public grade schools, colleges and universities.
Wilson’s concerns focused on Utah’s fast-growing tech market and worries that if income tax were raised, those companies would look for lower-taxed pastures elsewhere to start or grow their business. Wilson also said the sales tax base was narrowing, and that eroded income would make the increase gained by the initiative dry up within 15 to 18 years. He added that legislators would likely not feel confident about passing or promoting any measure without a clear idea of where that money would go.
“This is a temporary solution and it makes us feel good because we’re doing something, and something needs to be done. But this is a temporary fix,” he said. “[Tax reform] is the only way to get a permanent fix.”
Stevenson’s concerns about the initiative were also in regards to the increase coming from income tax, and suggested an additional tax on fuel, for example, could be a more delicate means of collecting more money for education than a higher income tax rate. Collecting sales tax from unreported internet purchases, as per state law, could also increase revenue that could be used for education, he said.
His concerns about education, though, were overshadowed by his worries about more generalized budget shortfalls, a topic he returned to several times during the panel.
“We have a tremendous shortage of funds,” he said, noting that education funding was not at risk of being trimmed in the ensuing struggle to balance the budget. “We’ve got some problems to solve. We’ll find some more money through the process, but it won’t be a lot. We won’t have the kind of funding we had last year.”
“There are probably a lot of dollars that could be found just by rearranging the deck chairs,” he added.
All three panelists stressed the importance of reforming the tax code—including cracking down on those unreported online purchases. The reform might include such measures as decreasing or even eliminating deductions for children, or other measures that make the average Utahn pay far less than the supposed flat 5 percent income tax rate, said the lawmakers.
“We started with a good tax code—we always do,” said Stevenson, but noted that far too many exceptions were made every time a reform was attempted. “When we get through carving, we’ve lost some of the effect of [the tax code].”
In terms of the state’s alcohol reforms, the lawmakers rebuffed the state’s reputation for being a tee-totaler.
“I have looked at alcohol policies in a lot of states. We have a reputation here for having an odd alcohol policy. This is not the case,” Stevenson said. “We’re in the middle.”
Wilson touted the state’s low underage and binge drinking rates. Stevenson acknowledged controversy from some around the so-called “Zion Curtain,” which prohibits alcoholic drinks from being made, mixed or poured in sight of diners, but said because of the complexity the law has gained over the years—including grandfathered establishments from before the law was passed, and restaurants that have two separate business licenses as a means of side-stepping the law—it is difficult to simply repeal at this point. That doesn’t mean it’s a dead issue—there were four pro-alcohol bills passed last year, Stevenson said, there are a handful of alcohol bills appearing before lawmakers again this year.
And while the horizon was obscured by a thick swath of inversion Wednesday, Wilson touted the 40 percent reduction in pollutants over the past 25 years, and fewer days falling above the Environmental Protection Agency’s “compliant” scale. The state also received $35 million as part of a settlement from Volkswagon, which had to pay $14.7 billion in a federal settlement after falsifying emissions reports on two lines of diesel-engine cars. Wilson said that money should be used judiciously in such a way as to have the maximum impact on the state’s air quality as possible.
“There are some things we could do that will make us feel good that are very expensive, that will burn through that money very, very quickly and won’t make a hill of beans’ difference,” he said. “There are other things that aren’t as feel-good or exciting that are going to be much more effective long-term.”