A huge chunk of Utah’s state budget for next year just passed. What you need to know about base budgets
Amid this week’s debate over what may be the most contentious legislation of the 2024 Legislature, Utah lawmakers squeezed in the passage of multiple bills putting in place what’s known as the base budget for the upcoming fiscal year.
Adding up to about $28 billion, around 96% of the anticipated spending in the budget year that begins July 1, the eight bills passed by both the House and Senate as of Thursday are intended to give state agencies what’s needed to keep necessary programs going.
Once the state’s revenue estimates are updated for a final time later in the 45-day session, those budgets then can be supplemented with the additional sales, income and other tax collections expected, through the end of the current budget year as well as the next.
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“We want to keep the doors open and the lights on,” joked Sen. Mike McKell, R-Spanish Fork, when introducing the business, economic development and labor base budget bill, SB4, on the Senate floor Wednesday.
The practice started nearly two decades ago, after then-Gov. Olene Walker successfully pushed through her elementary school reading program in 2004 by threatening to veto the state budget.
Lawmakers responded with a new plan, to approve a minimum or base budget early enough in the session that if a governor were to exercise his or her veto powers, there’d be time to override that action.
Early on, the process was touted as giving legislators more time to focus on how best to spend new money, although concerns were raised that included the impact of splitting funding decisions on the balance of power between the legislative and executive branches.
Lawmakers start their budget reviews even before the annual legislative session starts in January, at around the same time that the governor typically releases his proposed spending plan. Under the Legislature’s rules, they have 10 days to pass base budgets.
Today, the process has become so routine that the spending bills were quickly approved in the House and Senate around the debate over bills dealing with diversity, equity and inclusion programs, and with transgender bathroom access.
“It’s a great process,” Senate President Stuart Adams, R-Layton, said, describing how the focus on what an agency actually has to have to operate as “taking some of the politicization out” of coming up with an annual budget.
“Isn’t it cool that they get to look at their current budget and reevaluate it and then we start with the new money? Before we ever add anything, we get to find out if what we’re doing is the right thing,” Adams told the Deseret News.
What began as a way to make sure lawmakers “weren’t held hostage” over budget negotiations with the governor has evolved into a valuable tool that continues to improve the budgeting process, the Senate leader said.
“We talk about unintended consequences up here all the time, but there’s unintended benefit,” he said. “However it started, it really doesn’t matter. It’s become, I think, a significant benefit to the state.”
State agencies no longer need to be told to reduce their base budgets by a set amount to demonstrate they’ve done a thorough review of their spending, the Senate president said, noting most now just “use their best judgement” in presenting their needs.
“I think we’ve trained our agencies really well,” Adams said, giving lawmakers confidence in them. “You want to be able to trust everyone and people that come in and actually work hard and do good jobs. Hopefully we can reward them.”
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House Speaker Mike Schultz, R-Hooper, is also a fan.
“Passing a base budget early in the session gives us a starting point and ensures government keeps moving, even in unforeseen circumstances. It’s a commonsense practice that ensures taxpayer dollars are spent most effectively,” Schultz said in a statement.
The speaker noted that unlike some other states, Utah’s Legislature has a constitutional mandate to pass a balanced budget. That’s why, he said, “states around the country face billion-dollar deficits while Utah has a multibillion-dollar rainy day fund.”
Utah’s base budget process is “quirky and obscure” but important, according to a 2022 post by the Sutherland Institute, since that’s where decisions are made about “the overwhelming majority of spending of taxpayer dollars.”
The Salt Lake City-based conservative think tank pointed out that in each year since the process was established, the governor and the Legislature have been able to reach consensus on a final budget “despite any political or policy disagreements.”
Even so, the Legislature’s prioritization of a base budget is a key civic function, according to the institute, giving lawmakers a chance to “deeply scrutinize the spending of more than 9 in 10 taxpayer dollars and to understand where taxpayer dollars are going, and why.”
