Feature

Constitutional Amendment B
a Wise Choice

Of the five proposed constitutional amendments that will appear on the November ballot, four are generally administrative in there purposes. Constitutional Amendment B, on the other hand, is a forward looking effort to expand the sources of revenue that can be placed in the state's permanent trust fund, which was established in 2001.

Why is the amendment necessary? Under the current Utah Constitution, the trust fund can only receive money from two sources: (1) money the state receives relating to the November 1998 settlement agreement with leading tobacco manufacturers; and (2) other funds and assets by bequest through a will or by private donation.

"The Utah Constitution does not currently state that the trust fund may include money from any other source," says Senator Lyle Hillyard (R-Logan), senate chair of the executive appropriations committee. "Ironically, the legislature has no power to put money in the fund."

Money from the tobacco settlement will eventually run out and it is disputable as to whether the current Utah Constitution would allow the legislature to appropriate money to the trust fund from any other source than the two specified, thus the effort to broaden the revenue sources that can be used to add money to the fund.

Supporters of the amendment would like to see a steady stream of money going into the trust fund, similar to what is being done in Wyoming and Montana, both of which have trust fund balances in the billions of dollars. Both states use earnings from their trust funds to provide tax relief for citizens and revenue for schools and other important public services.

If the amendment is approved, Hillyard's plan is to put in place a mechanism to fund the trust fund through severance taxes as well as bequeathed monies. Utah collects nearly $100 million annually from the severance taxes imposed on the extraction of minerals, crude oil and natural gas. Passage of Constitutional Amendment B would open the door for the Legislature to place all or a part of the revenues received from state severance taxes on minerals, crude oil, and natural gas into the state's permanent trust fund. The earnings from the fund could then be used for capital and infrastructure projects both statewide and in energy producing areas of the state.

"As it stands now, we could exhaust our non-renewable resources, spend every dime from severance taxes, and have nothing to show for it. We need a nest egg for future generations," Hillyard says. "Some people think the state ought not save any money, period, but give it back to the tax payers. I think we ought to be disciplined enough to put some money away for future generations and the trust fund is the place to do it."

No one knows when, but one day Utah's natural resources will be gone. "What will Utah have to show for the tons of ore and millions of barrels of oil and gas extracted from our state then? Nothing, if we continue with business as usual," Hillyard says.

The ballot question reads thus: "Shall the Utah Constitution be amended to allow a permanent state trust fund to include money or other assets given to the trust fund under any provision of law?"

Enactment of the amendment will not likely result in any increase or decrease in revenue or cost to state or any local governments. What's more, money may be removed from the trust fund only if the governor and three-fourths of the legislature agree. Interest and other income earned from the money in the trust fund are deposited into the state's General Fund.

EDCUtah encourages its investors and partners to study the issues and consider the likely benefits the passage of Constitutional Amendment B will have for the State of Utah.

BYU to Honor Seven Notable Alumni, Friends During Homecoming 2008

Brigham Young University will recognize seven outstanding alumni and friends during Homecoming activities this month. J. Blair Buswell (BA '82), James S. Olson (BA '67), Steven T. Densley (BS '70), and Michael K. Young (BA '73) will each receive the Distinguished Service Award. In addition, Sean D. Reyes (BA '94) will receive the first-ever Young Alumni Distinguished Service Award, Alice Schindler Cannon (BA '58) will be honored with the Service to Family Award, and Jack W. Sunderlage will be presented the Honorary Alumni Award.

Click here to read the details about each of the award recipients.