Will Utah voters increase their taxes this November?

Utah needs money to finance our inexorably steady growth — for public education; colleges and universities; transportation; health care; courts; prisons; substance abuse and mental health. A racing economy, constant population growth, including a yearly wave of kindergartners, and the almost magical increase of the numbers of cars and trucks on our roads create increasing pressure on the state’s tax revenues.

Growth brings some revenue with it — more jobs and better pay yields more income and sales tax revenue. But there’s never enough. We don’t have a broad consensus that our current revenue and taxation mix is just right. Some think we need more revenue, much more; others think we need to cut taxes; still others think our revenue and tax balance is about right.

After the Nov. 6 ballot, we will know much more about Utahns’ attitudes about increasing funding for two major initiatives.

Medicaid

Around 100,000 healthy Utah adults earn less than the federal poverty level, which is around $36,600 for a family of four. Because of a quirk in the Affordable Care Act, these people do not qualify for Medicaid, nor are they eligible for health insurance on the federal exchange. Paradoxically, their slightly better off neighbors who earn more than 100 percent of the poverty level qualify for heavily subsidized health insurance through the federal insurance exchange. Without Medicaid or subsidized health insurance, these 100,000 of our fellow citizens face bleak choices. They can’t afford health checkups; they can’t pay for ongoing care and prescriptions for chronic conditions; where possible they use free clinics, or they visit emergency rooms for everything from heart attacks to minor cuts, where they will receive care no matter their ability to pay. But emergency departments are not equipped to manage chronic or serious illness like diabetes, congestive heart failure or cancer.

Even those who earn between 100 percent and 138 percent of the poverty level, and therefore qualify for federally subsidized health insurance on the federal exchange, often can’t afford their modest share of premiums, deductibles and copays. Expansion of Medicaid will help this group do just that.

The legislature has considered full Medicaid expansion and didn’t pass it.

A well-funded group has stepped into the breach and gathered enough signatures to put this issue on the ballot. Under the Affordable Care Act, the federal government will pay states that fully expand Medicaid 90 percent of the costs. Instead of Utah’s typical 30 percent share, the state would only pay 10 percent of the expansion cost.

To pay for the state’s share, sponsors included in their initiative a modest increase in sales tax — from 4.7 percent to 4.85 percent. Should this proposition pass, Utah will receive additional federal Medicaid funds of about $600 million per year.

Watch this one. It will be a telling vote.

Our Schools Now

Perhaps a more dramatic story is the movement started by some of Utah’s most influential citizens called Our Schools Now. This initiative was gathering signatures to get a qualify a proposition for the November ballot to increase education funding by $700 million per year through a combination of tax hikes. Near the end of the 2018 legislative session, however, Our Schools Now and legislative leadership negotiated a compromise. Our Schools Now agreed to abandon its voter initiative. Legislative leadership agreed to increase funding for Utah’s public education system by a combination of first, freezing declining state property tax levies which will ultimately yield around $250 million per annum, and second, increasing the gas tax by $120 million per year.

To test public sentiment, the legislature placed on November’s ballot a nonbinding question whether the state should increase our gas tax by 10 cents a gallon for a total of $120 million. If the public approves, the legislature will presumably pass the gas tax increase, which will free up $120 million in new education funding.

While Utah has increased education spending by over $1 billion in the last several years, most of it, except teacher pay, has simply financed the steady growth in student numbers.

Utahns have always been committed to increasing education funding, provided it goes to the classroom.

Again, two important ballot questions will ask voters to approve tax hikes to expand Medicaid and public education funding. What will Utah voters do?

CREDIT: Greg Bell