|
FY25 Governor’s Budget Recommendations and EAC Revenue Estimates Released
The Governor’s announcement of his Fiscal Year 2025 budget and policy recommendations, which took place at a newly developed residential community in West Haven, shared highlights of the State’s roughly $29.5 billion proposed budget. The Governor’s remarks and recommendations included in the budget focused around “Utah First Homes” – a new $150M initiative with the intent to build over 35,000 new starter homes by 2028 to increase the number of Utahns who are able to purchase a home. The primary budget release followed a previous announcement on Monday where the Governor shared the homelessness highlights of his budget, which proposed $193M in new funding to alleviate homelessness. The budget will be considered along with other legislative priorities during the 2024 General Legislative Session. Highlighted below are some notable recommended funding items that relate to the goals of the Wasatch Choice Vision:
Transportation
- $45M for ongoing statewide public transit investment
- The proposed budget notes that, “As transportation demands increase, simply adding new lanes and roads will not be enough. Meaningful investments across our transportation system, including active transportation and public transit, will reduce the number of cars on our roads and improve road congestion and air quality.”
- To enhance Utah’s transit system “for improved convenience, frequency, and reliability,” the governor recommends reallocating 1% of the state sales tax revenues from the Transportation Investment Fund (TIF) to the Transit Transportation Investment Fund (TTIF). In FY25 this is estimated to be approximately $45 million. An amount equivalent to 19.68% of the state sales tax would continue to be deposited into the TIF for roadway projects.
- The proposed budget specifically calls out the opportunity to use these funds for the FrontRunner station at The Point, which received $200M in one-time funds in the last legislative session, and requires an additional $200M to be fully funded.
- During the budget release, the Governor noted that additional funding to enhance our regional transit system will be critical as Utah prepares over the next ten years to host the 2034 Winter Olympic Games.
- $2.5M one-time for a transit innovation grant pilot
- The recommendation is intended to help increase convenience and access to public transportation and boost ridership. The grants would be administered to fund locally designed projects, and would require matching local funds.
- This was a recommended item from the Unified Economic Opportunity Commission (UEOC), for programs like first/last-mile connection shuttles, K-12 fare pass programs, increased frequency to transit hotspots, and rural “Good Neighbor” ridership programs.
- $1.5M one-time and $400K ongoing for advanced air mobility
- This funding would help the Utah Department of Transportation to develop an office, and foster an innovative environment for the unmanned aerial system industry and enable the public and private sectors to develop concepts and technologies for the industry.
- $555M for Transportation Debt Service
- In the 2023 Legislative Session, the Legislature appropriated funding to pre-fund transportation debt service if revenue collections met or exceeded revenue estimates in future years. The Governor recommends retaining half of that set aside for the intended transportation debt service, and reallocating the remainder.
Housing, Infrastructure, and Growth
- $150M one-time for “Utah First Homes” initiative
- The Governor Recommends with his Utah First Homes initiative that over 35,000 new starter homes be built by 2028.
- $75M one-time for State Infrastructure Bank Expansion for Housing to provide low-interest loans for publicly-owned infrastructure to support the development of new housing. In the 2023 General Session, the SIB was expanded to create an account for water and sewer projects in greenfield areas, but it did not receive an appropriation to fund the new account.
- $50M for the State’s First-Time Homebuyer Assistance Program (SB240, 2023).
- The initiative also includes $5M for a Starter Home Innovation Fund, $15M for sweat equity programs, and $5M for community land trust expansion.
- $45.5M for Affordable Housing
- The budget includes $30M for deeply affordable housing grants, $5M for gap financing through the Olene Walker Housing Loan Fund, and $10M for the Utah Housing Preservation Fund.
- Utah Housing Innovation Advisor
- Upon the release of his budget, the Governor also appointed a Housing Innovation Advisor to his office. Former State Representative Steve Waldrip will work with stakeholders from local government, the building community, and state agencies to develop a comprehensive strategy for tackling the state’s housing supply and affordability challenges
- $250K for a Housing Capacity Analysis
- A recommendation from the UEOC, the Housing Capacity Analysis is intended to analyze likely and desired growth, capacity, and the rate at which the market will consume infrastructure investment. The study should provide insight into the type of product likely to be delivered, and compare current capacity with forecasted demand to inform updates to zoning, transportation planning, and/or water availability for adequate housing.
Other Recommendations
- $40.5M for recreation and open space
- $81.6M for water and watersheds
- $193M to alleviate homelessness
We appreciate the Governor, and his team at the Governor’s Office of Planning and Budget (GOPB), for putting together thoughtful recommendations that elevate the need for continued investment in infrastructure as Utah continues to face significant growth.
Executive Appropriations Committee update consensus revenue estimates
The Executive Appropriations Committee met yesterday to release the updated revenue estimates and direct the legislative fiscal analyst staff to include base budget set asides - including $775M one-time and $335M ongoing for infrastructure that was initially set-aside in a budget action last session, and begin preparing base budget bills for the 2024 Legislative Session. Otherwise, the legislature anticipates $133.5M in available one-time revenue, and $504M in ongoing revenue for the upcoming legislative session. This compares to the $3.2B in one-time and $2.5B in ongoing they had for the legislative session last year. Legislative staff shared that revenues are now growing at a more sustainable, albeit modest growth rate compared to the past several years of significant state surplus.
In the coming weeks leading up to the session, we also anticipate the House and Senate Majority and Minority Caucuses to release their 2024 Legislative Session Policy Priorities.
We look forward to working with the Legislature as they plan, prioritize, and ultimately appropriate the Fiscal Year 2025 state budget.
Recap: November Legislative Interim
The legislature met for their last interim meetings of the year last month. Here were a few notable highlights from those meetings:
- The Legislative Audit Subcommittee released a Performance Audit of Utah Housing Policy. The report provided recommendations for housing targets, land use regulations, and statewide housing goals to accommodate Utah’s housing challenges. Our partners at the Utah League of Cities and Towns provided a response to the audit in committee and on pg. 61 in the appendix. This audit was also heard in the Economic Development and Workforce Services subcommittee.
- In Political Subdivisions and Transportation Interim, Representative Karen Peterson shared her proposal for Transportation Utility Fee legislation. Though a bill file wasn’t considered, Rep. Peterson shared that the working group including ULCT, the Utah Taxpayers Association, and others (including WFRC) came to an agreement on the approach for the bill. The Transportation Utility fee was ruled as an eligible municipal fee by the Utah Supreme Court, and Rep. Peterson’s approach would allow cities to retain their ability to charge the fee, while also providing reasonable parameters for adoption to ensure an adequate process for imposing fees and using funding appropriately. This concept was also supported by the Unified Economic Opportunity Commission.
- The Transportation Interim Committee considered a number of committee bills for things like Utility Relocation Cost, Road Rage Amendments, etc. Notably was Rep. Lesser’s Canal Trails legislation which would require coordination amongst canal companies, UDOT, municipalities, and other partners to better accommodate canal trails. We look forward to continuing to work with Rep. Lesser on this bill as a member of her working group.
With the resignation of Speaker Brad Wilson in his run for the Senate seat being vacated by Senator Mitt Romney, a new set of House Majority Leadership was elected by the body. Representative Mike Schultz was chosen by his colleagues to lead the House of Representatives as Speaker, with Jefferson Moss as Majority Leader, Karianne Lisonbee as Majority Whip, and Casey Snider as Majority Assistant Whip. Speaker Shultz is a former member of WFRC, and we wish him well in his new role!
2023 Municipal Elections
The 2023 General Municipal election was held on Tuesday November 21st, mainly for city council seats as well as a few mayorships. A special congratulations to our new and continuing elected officials for a successful midterm election season! We look forward to working with you in the coming weeks, months and years as we all strive to ensure Utah’s quality of life remains strong as we grow. And to our outgoing elected officials, a sincere thanks for your dedicated service to your constituents, the region, and our state. It has been a pleasure working with you, and we wish you well on your next endeavors!
Lookahead: 2024 General Legislative Session
The countdown begins as we are merely six weeks away from the start of the 2024 General Legislative Session. As we prepare for the upcoming session, we are currently tracking legislative bill files and appropriations that appear to be related to transportation, land use, air quality, housing, and economic development (again, issues encompassed in the Wasatch Choice Vision) through our WFRC 2024 Bill Tracker and WFRC 2024 Appropriations Tracker. Note that these are currently updated with the most up to date information from the Governor’s Budget, and also note that you can find previous year’s bill trackers, bill summaries, and legislative session wrap-ups on our Government Affairs Webpage.
|
