On Tuesday, January 18th, the 2022 General Session kicks off at the Utah State Capitol. For the following 45 days, lawmakers will consider new legislation and authorize the state’s budget for the remainder of FY 2022 along with the whole of FY 2023. To balance the state’s budget, legislators need key pieces of information including the direct fiscal impact of proposed legislation and up-to-date revenue estimates. To provide this information, the Legislative Fiscal Analyst (LFA) prepares fiscal notes for each bill within three business days of receiving the bill file and Legislative Economists, along with the Governor’s Office of Planning and Budget (GOPB) and the Utah Tax Commission, prepare revenue estimates for the budget year. Those estimates are presented to the Executive Appropriations Committee ahead of their deadline to draft the final appropriations act (38th day of the session).
Prior to updated revenue estimates, the LFA, GOPB and the Utah Tax Commission prepare monthly revenue tax revenue summaries that can be used to understand where collections are for the year. January’s Revenue Snapshot and Tax Revenue Summary indicate that revenues are strong and growing slightly faster than the annualized projection.
Through six months of FY 2022, the Education Fund totaled $2.8 billion, which is on target with projections for income tax collections. The General Fund reported a growth rate of 20.8% over FY 2021, which is higher than expected. It’s important to consider that January’s report captures collections from December, for sales and wages that took place in November. This carries two caveats: first, a portion of the General Fund performance is likely due to holiday sales, and secondly, these figures do not capture the impact that recent events in the pandemic have had on Utah’s economy. Other notable takeaways from the reports include the performance of the mining and oil industries, with severance tax for both mining and oil/gas along with mineral production withholding collections up by more than 250% percent over January 2021.
The reports referenced in this post are available at the following links:
January Revenue Snapshot (FY 2022)
Tax Commission Revenue Summary (Period 6, FY 2022)