UTAH STATE BUDGETEARMARKS, DEBT AND TRANSPORTATION
Presentation by
Natalie GochnourAssociate Dean, University of Utah
Chief Economist, Salt Lake Chamber
February 3, 2014
Jan-00
Aug-00
Mar-01
Oct-01
May-02
Dec-02Jul-0
3
Feb-04
Sep-04
Apr-05
Nov-05
Jun-06Jan-07
Aug-07
Mar-08
Oct-08
May-09
Dec-09Jul-1
0
Feb-11
Sep-11
Apr-12
Nov-12Jun-13
1000000
1050000
1100000
1150000
1200000
1250000
1300000
DOT.COM/9-11Recession
Great Recession
Utah lost 100,000 jobs
Source: Utah Department of Workforce Services
Utah Job Count
Source: Utah Legislative Fiscal Analyst, 12/17/2013
UTAH EARMARKED SALES TAX REVENUE
Source: Governor’s Office of Management and Budget
UTAH NET GENERAL OBLIGATION DEBT PER CAPITA
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
$710$640 $623 $550 $476 $434
$571
$868
$1,157$1,283
$1,161
Source: 2013 Comprehensive Annual Financial Report, Utah Division of Finance, Oct. 23, 2013, p. 228-229
UTAH OUTSTANDING GENERAL OBLIGATION DEBT
Source: Governor’s Office of Management and Budget
Delaware Utah
Marylan
d
Virgina
Missouri
North Caro
lina
Indiana
Iowa
Median (A
ll Stat
es)
Median AAA
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%8.2%
6.8%
5.7%5.3%
4.5%3.6%
2.0%
0.9%
4.9% 4.9%
Source: Utah Legislative Fiscal Analyst, 12/17/2013
UTAH’S DEBT SERVICE RATIO COMPARED TOOTHER MOODY’S AAA-RATED STATES
FIVE-YEAR BUDGET POSITIONFY13-FY17
Education Fund General Fund Transportation
($10,000,000,000)($5,000,000,000)
$0 $5,000,000,000
$10,000,000,000 $15,000,000,000 $20,000,000,000 $25,000,000,000 $30,000,000,000 $35,000,000,000 $40,000,000,000
$619
,897
,000
.00
$339
,946
,000
.00
($4,
907,
532,
000
.00)
$18,
477,
453,
000
.00
$37,
326,
416,
000
.00
$11,
070,
061,
000
.00
$17,
857,
858,
000
.00
$36,
896,
470,
000
.00
$15,
977,
593,
000
.00
Budget Posi-tionCash InflowCash Outflow
Source: Utah Legislative Fiscal Analyst, 12/17/2013
Debt; 52%
Projects;
48%
$717 m
TRANSPORTATION INVESTMENT FUND EXPENDITURESFY14
Source: Utah Legislative Fiscal Analyst, 12/17/2013
BORROWING FOR PROJECTED OUTFLOWSEstimated Outstanding Debt & Constitutional Debt Limits
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
$0$1$2$3$4$5$6$7$8$9
$10
0
0.5
1
1.5
2
52%
74%87% 82% 80%
71% 61%51%
43% 37% 31% 25% 19%
Constitutional Debt Limit Available Debt 85%Existing Debt New Debt with Trend Expenditures
Billions
Source: Utah Legislative Fiscal Analyst, 12/17/2013
BENEFITS PRINCIPLE OF TAXATION
• Those who benefit the most from the transportation network should pay the most for its continued operation.
• Efficient – matches supply with the demand• Curb overuse• Reduce wear and tear• Reduce traffic congestion• Combat air pollution
• Ex. Someone driving 40 miles to work each day should pay more for roads than somebody who works from home.
Share of State & Local Road Spending
Covered by User Fees
Source: Tax Foundation and American Petroleum Institute
Mississippi
New Mexico
Missouri
North Dakota
Vermont
Utah
Louisiana
Wyoming
South Dakota
Alaska
U.S. Average
- 10.0 20.0 30.0 40.0 50.0 60.0
33.1 33.1
31.6 29.8
29.0 28.8
25.4 24.5
21.5 10.5
50.4
Percent of Spending Covered by User Fees
U.S. Average and Bottom Ten States: 2011
Utah ranks 46th lowestFor user fee contribution
Motor Fuel Tax Comparisons
Source: Tax Foundation and American Petroleum Institute
Wyoming
Arizona
Colorado
Utah
Idaho
Nevada
California
- 5.0 10.0 15.0 20.0 25.0 30.0 35.0 40.0 45.0 50.0
14.0
19.0
22.0
24.5
25.0
33.1
48.7
Cents Per Gallon
As of January 2013
19971998199920012002200320042005200620072008200920102011201215
20
25
30
35
40
28.7 28.8 28.3 28.5 28.8 29 29.530.3 30.1
31.2 31.532.9
33.9 33.835.6
U.S. Passengers Cars: Miles Per Gallon
Source: US DOT, Summary of Fuel Economy Performance
AVERAGE FUEL EFFICIENCY
• Buying power of motor fuel tax has declined 45% since 1997.
• The 24.5 cents is now equivalent to 16.9 cents in inflation-adjusted terms. (Adjusted using CPI-U)
BUYING POWER
Source: Salt Lake Chamber calculations
