Congratulations to our graduates!
This is was certainly a crazy, unexpected, non-traditional last semester. Kudos to all the students and parents that made it through. I love seeing the lawn signs congratulating our graduating seniors–good luck in all you choose to do!
BUDGET CUTS
All legislators are assigned to an appropriations subcommittee. These subcommittees are charged with reviewing budgets, eliminating inefficiencies, and prioritizing spending of new monies. Because the state is losing revenue due to the situation with COVID-19, each appropriations subcommittee has been asked to find three levels of cuts–2%, 5%, and 10%–to the base budget of their respective committees. This is on top of eliminating all new money that was appropriated this year. We are projecting a shortfall of between $600 million-$1.3 billion. You can find monthly budget projection updates and other budget news and data at utah.budget.com.
Our fiscal analysts are working with departments and subcommittee chairs to find ways to make these cuts. The subcommittees will meet at the end of this month to review and vote on these cuts. The Executive Appropriations Committee will look at each committee’s recommendations and then put together a new budget. It won’t be across the board cuts, but everything is on the table.
I am on the Social Services Appropriations, which includes the Departments of Health, Family Services, and Work Force Services. I am very concerned about cutting budgets for services and programs that have been the most heavily impacted and stressed by COVID-19 and the quarantine. However, there are certainly places in our budget where we can find efficiencies.
SOME GOOD NEWS
The good news is that Utah has better and more options than most other states for addressing our revenue losses. Because of our state’s low debt ratio, healthy rainy day funds, and fiscal management, Utah has a AAA bond rating and has been approved for a 15 year bond at 1.156%. That is an incredibly low interest rate. This bond will be used to pay for the construction projects we are already committed to.
We also have those healthy rainy day funds. However, they should only be used after exhausting other possibilities because they are one time funds. We have to be very careful when paying for ongoing programs with one-time funds.
In addition, there are some agencies within the state that have discovered increased efficiencies in response to the pandemic that could be reflected in these budget cuts, e.g. employees working from home, and increased utilization of technology and automation.
Despite decreased revenue, Utah is in a better position to continue handling COVID-19 and the challenges the future holds than most other states. You can read more about this HERE.
UNEMPLOYMENT
My heart goes out to the many business owners, employees, and families who have been impacted by our economic shutdown. I can’t imagine the anxiety, frustration, and sadness you have experienced. Please let me know if there is anything I can help you with.
Unemployment insurance claims dropped 12% from the previous week to 6,275 claims; however, it is still a 455% increase from the average weekly claims seen in 2019. You can read an article about this HERE.
The fifth and final CARES act program is now available for Utahns. The Pandemic Emergency Unemployment Compensation Program (PEUC) allows eligible individuals who have exhausted their benefits to receive up to 13 weeks of additional unemployment benefits. To be eligible, you must have been receiving unemployment benefits, but reached your maximum eligible weeks and are still unemployed. If you think you qualify, or to learn more, please visit jobs.utah.gov/covid19.
Let me know if you have any questions or comments.