KSL Investigates: Tax Reform & Education Implications

SALT LAKE CITY, Utah — With little to no language addressing education specifically in the more than 200-page tax reform proposal Utah lawmakers passed Thursday night in a special legislative session, there is serious concern over the immediate future of school funding across the state.

“We are emphatic and vehement in our demand for a Constitutional guarantee that assures our students have what they need in public education,” Heidi Matthews, the president of Utah Education Association, explained. “We support having a long-term stable tax structure in this state. We need it to assure that our students are going to have what they need, and that’s the piece that has not been heard.”

It’s likely Matthews and education advocates in Utah will have to wait now until Jan. 27 – the first day of the 2020 general session – before they expect to hear anything specific about K-12 education funding moving forward.

But, as state law exists right now, income tax funds K-12 education in Utah. It’s guaranteed in the state’s constitution.

Matthews says it’s important to note that just 30 percent of the income tax goes to K-12 public education, adding that the tax reform legislation will inevitably “gut” education funding from there. Until education is directly addressed, teacher and student advocates are left anxiously waiting what’s next.

“Any tax restructure of this of this magnitude needs to include that piece of security for an ongoing investment in public education,” Matthews added. “There is nothing in this plan that addresses public education in a meaningful way.”

Lawmakers who support the reform say despite the income tax break, education funding will be made up in other ways – like through an increase in sales and gas taxes.

“We’re going to cut income tax, we’re going to raise sales tax. So basically, we’ll be moving more sales tax into higher education and that will allow us to move some of the money that we used to spend – income tax we used to spend on higher education – into the K-12 education,” Rep. Brad Last, D-Hurricane, said.

The problem? None of that is set in stone. It’s not written down. It’s not law. Meaning… there’s no guarantees and people are skeptical.

Retired teacher and Rep. Carol Spackman Moss, D-Holladay, is just one skeptic.

“We’re cutting education short and we’re really betraying the trust that so many Utahns have in us to have really great public schools, because education is one of the most important fundamental things to any society,” Spackman Moss explained. “It’s not clear at all what the outcome is going to be. As we often say in legislating, it’s the unintended consequences that we’re concerned about.”

The reform will likely impact funding for higher education, as well. Again, it’s just not clear how.

“We have only hints of potential promises or some proposed drafts that had been crafted without a lot of input at all, and [we’re] mostly in the dark and that’s concerning,” Matthews said.

Representative Last works in higher education at Dixie State University. He says the tax reform proposal has been vetted for months and was ready for a passing vote.

“The primary responsibility as legislators – in terms of the tax reform – is to keep our economy strong, to keep us moving in a positive direction, and I think that that is exactly what this does,” Last said. “If we can keep our economy strong, keep job growth strong, manufacturing strong, take whatever portion of the economy you want to talk about – if we can keep that strong, the revenues will be coming in one way or another. Whether it’s sales tax, income tax, and course property tax. And that’s really what we’re trying to do as a state legislature is just keep our three-legged stool of property, income and sales tax strong.”

Speaker of the House Brad Wilson and Senate President J. Stuart Adams released the following statement Thursday night, commending the impact of the reform’s passage:

“Earlier this evening, the Utah Legislature passed significant tax reform legislation. The bill includes targeted credits for lower-income individuals and families, as well as a $160 million tax cut in ongoing funds and $88 million in one-time funds that Utahns should see reflected in their take home pay in early 2020. We express our appreciation to the many citizens, lawmakers and other community stakeholders who contributed to this tremendous effort. These critical changes to our tax structure will ensure a bright and prosperous future for our state.”

Some teachers say the stronger focus should be on funding K-12 education specifically.

“We have a challenge in front of us because in our current situation right now, we are not adequately funding our schools,” Matthews added. “We have some of the highest class sizes in the nation, we have the lowest per pupil education funding in the nation, and our students are coming to us with greater and greater needs, and we have fewer and fewer resources.”

Education advocates like Matthews feel the tax reform legislation was rushed at the end of the year, giving lawmakers and constituents especially only days to review the complicated proposal.

“This has had so much more attention than it would ever get in a regular session. So, I don’t buy the argument that we’re rushing this,” Last says. “I understand the ‘anxiety,’ I guess is a good word, from the education community and of course the last thing you ever want to do is to have a politician look you in the eye and say, ‘Trust me on this.’ But, I’ve been in the legislature 17 years. This next session will be my 18th year, and I can tell you that the number one priority every single year has been education funding.”

He continued, “We’re going to fund education the best that we can.”

As for teachers? Matthews say they’ll remain resilient. That’s what they do every day.

“We’re not going to stop fighting for what’s best for our kids and, and for our profession,” she added. We look forward to – to finding that education piece collaboratively in the in the general session.”

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