Dear Neighbors and Friends,
The 45-day Legislative Session starts at the State Capitol on January 27 and runs until March 12. It’s an honor to represent you at the state legislature. This email will give you information on what I am working on in the session, details on our town hall meetings during the session and additional data and information on the Tax Reform bill that was passed in December.
I am working on 8 bills this session. The bills I am working on include improvements in current state code or are bills that will improve our growing state. These bills have been brought to me by the following organizations: Cache County Sheriff, Cache County Attorney, Utah State School Board, USU Center for Persons with Disabilities, Cache Valley Transit, Commission on Housing Affordability and local plumbing contractors.
I am the House Chair of Business, Economic Development and Labor Appropriations Committee, Co-Chair of Commission on Housing Affordability, Committee member of Law Enforcement and Criminal Justice and Political Subdivisions Committees. I will be working on reviewing and making decision on bills and appropriation requests that come to these committees.
You can follow my bills and all other bills, as well as follow House and Senate chamber and committee discussions live or recorded at le.utah.gov.
Cache Valley Legislators will again hold weekly Town Hall Meetings and during the session, starting January 25.
What: Cache Valley legislators will hold a town hall meeting each Saturday morning of the legislative session to hear from constituents and report back on the progress of the legislative session.
Who: Sen. Lyle Hillyard, Sen. Scott Sandall, Rep. Joel Ferry, Rep. Dan Johnson, Rep. Val Potter and Rep. Casey Snider
When: 7:30-8:30 a.m. every Saturday morning beginning Saturday, January 25 and ending on Saturday, March 7
Where: County Council Chambers at the Cache County Historic Courthouse, 199 North Main Street, Logan, Utah
- Each town hall will be livestreamed on the Cache County Facebook page.
- Meetings will be moderated by County Executive Craig Buttars.
- Light refreshments will be provided.
There has been a great deal of questions and concern over the Tax Reform bill that was passed in special legislative session last month.
I want you to have an overview of this important Tax Reform bill so you see the big picture of what we did and why. One thing that I have learned is that there is a lot of misinformation being spread right now. Many people have picked out one aspect of the bill they don’t like without looking at the larger structural budget problem and why we did what we did and how important it is to the State of Utah. Please take a few minutes and read through this. Also, there is a link with more details if you are interested.
SB 2001 – 2019 TAX CUTS AND TAX REFORM BILL
Overview of the current tax bill:
- Offers hundreds of dollars to middle and low-income families in 2020 to cover increases in gas and grocery taxes – no paperwork required
- Provides ongoing tax credits for groceries and for dependents
- Helps those in intergenerational poverty
- Puts $510 per year back into the pocket of the typical Utah family
- Reduces the state tax on Social Security
- Reduces taxes overall by $160M annually
- Gives a net tax cut to nearly 90% of Utahns
- Increases funding available to public schools
- Stabilizes and enhances funding for social services, housing, air quality and low-income healthcare programs
ISSUE 1 – CHANGE: Our economy is changing, going from goods based to services based. Question: When did you last buy a music CD or a DVD? You paid sales tax each time. When did you last download music or rent a movie online? You paid no sales tax each time.
ISSUE 2 – GROWTH: In 1997, $0 of General Fund money went to roads, state funding was from the gas tax. In 2019 we spent $632 million of the General Fund on roads in addition to state gas tax funding.
RESULT: The General (Sales Tax) Fund is short by $600+ million and is overwhelmed by demands that outstrip revenue growth; while the Education (Income Tax) Fund is growing at 10x the pace of the General Fund because of the strong economy.
SOLUTION: Shift $ from Income Tax Fund to General Fund – Cut Income Tax/increase Sales Tax
SB 2001: Reduced Income Taxes collected by the State of Utah by $639 million and Increased Sales Taxes collected by the State of Utah by $479 million.
THIS RESULTS IN A NET OF $160 MILLION LESS IN TAXES COLLECTED BY THE STATE EACH YEAR
WHAT MAKES UP THESE REDUCTIONS AND INCREASES?
INCOME TAX FUND REDUCTIONS:
- Income Tax Rate drops from 4.95% to 4.66% – $348M less taxes paid by Utahns
- Dependent Exemption increased from $565 to $2500/dependent – $132M less taxes paid by Utahns
- Social Security Income Credit increases – $18M less taxes paid by Utahns
- Utah Earned Income Credit for low income created – $6M less taxes paid by Utahns
- Grocery Sales Tax Credit created – $135M less taxes paid by, or cash refunded to, Utahns
- $639 MILLION LESS TAXES PAID BY UTAHNS
GENERAL FUND REDUCTION AND INCREASES:
- Feminine Hygiene Products exempted from sales tax – $5M less taxes paid by Utahns
- Tax on Unprepared Groceries 1.75% to 4.85% – $250M more tax paid by Utahns & Visitors/Tourists*
- Sales/Excise Tax on Gas/Diesel** – $170M more taxes paid by Utahns & Visitors/Tourists*
- Motor Vehicle Rental Tax increased – $4.5M more taxes paid by Utahns & Visitors/Tourists*
- Repeal Some Sales Tax Exemptions** – $16M more taxes paid by Utahns
- Sales Tax on Additional Services** – $43M more taxes paid by Utahns & Visitors/Tourists*
- $431 MILLION MORE TAXES PAID BY UTAHNS
- $48 MILLION MORE TAXES PAID BY VISITORS/TOURISTS
*Utah Fiscal Analyst: Approximately $48 million of the food, gas and services sales tax increase is paid by visitors and tourists.
**Diesel excise tax will be 6¢ on 4/1/2020 and 10¢ on 1/1/2022.
***Repealed exemption items now subject to sales tax [$16 million in restored taxes] include: ski resort electricity; vehicles used at sporting events; admission to college athletic events; off campus textbook purchases; car washes, vending machines, cleaning services and games except when sold through coin-operated machines; railroad engine fuel; certain database uses.
*Additional services that will now be taxed [$43 million in new taxes] are: installation of tangible personal property when part of a taxable sale; pet boarding, grooming and daycare; personal transportation services, including ride sharing and sightseeing services; towing services; parking lots and garages; dating services; identity theft protection services; streaming media services; shipping and handling; and electronic security monitoring.
ADDITIONALLY: In 2020 there will be $60 million in 2019 dependent exemption rebates, and $12 Million in 2020 grocery sales tax rebates. $72 million more of our money in our pockets.
SUMMARY: Utah will put $639 million in the right pocket of its citizens, and take $431 million out of the left pocket and $48 million from Visitors & Tourists coming to visit our state. Utahns come out ahead by $208 million each year ($280 million in 2020 with the additional rebates). We continue to fund our roads along with most of our other state departments such as social services, corrections and law enforcement, higher education, natural resources, etc. With this new plan almost every taxpayer in the State gets a tax cut.
I look forward to hearing from you with your questions and comments, and I hope to see you and talk to you at our weekly Town Hall meetings during the legislative session.
Wed, Jan 22, 2020 at 3:07 PM:
If possible I’d like to add to My email that I recognize l that the signatures will likely require a referendum. However, the need for tax reform in our state is real and remains a critical need to resolve the imbalance in our State General Fund.