***Note: this bill has been substituted, this analysis may no longer be valid***
Utah often says that it promotes the family, and one of the way it shows this is through various policy decisions that are specifically designed to encourage the growth of the family. One of the most obvious examples of such a policy is the tax deduction for children. One area, however, where Utah appears to lack in fulfilling its commitment to family and family values is public education – ranking dead least in per-pupil spending across the nation, a situation that has persisted for years.
Senator Pat Jones (Democrat – Salt Lake City) is proposing that Utah change its policy towards the dependent deduction in order to specifically beef up education funding.
Generally speaking, Utah’s deduction for a child is $750 a year. This calculation is 75 percent of the federal deduction rate for a child and this percentage is set into state law. Through SB 118 – School Funding Through Income Tax Revisions, Jones is proposing a wind down in the dependent deduction over the next five years with the funds being placed directly into education.
If passed, SB 118 would reduce the percentage tax payers are able to deduct from 75 percent to 60 percent in 2014, resulting in a reduction in the deduction of $150. Over the next four years, the deduction continues to wind down by 15 percent year after year until, in 2018, the deduction for a child is completely removed from state code.
On the other side of the equation, Jones proposes that the money received by reducing and then eliminating this tax credit be directly placed in the education fund, being divided between standard public schools, private schools, and schools for the deaf and blind. 10 percent of funds received would be distributed evenly among all school districts across the state with the other 90 being distributed per pupil.
This would truly be a revolutionary and dramatic change to education funding in the state, and would have a real impact on family budgets as well. It is estimated that the number of children in Utah is nearly 880,000, and the state estimates that nearly $160 million will be added to the budget in just the first round of tax deductions. However, with an average of roughly two children per household, this policy also means that the average family will lose $1,500 annually in tax deductions come 2018.
This type of legislation would mark a massive sea-change in education funding if it were to pass. But, perhaps, desperate times call for desperate measures. Utah ranks in the bottom third of high school graduation rates in the country, below average for teacher salary, the second highest number of students per classroom, and the second lowest for per-pupil spending. To make matters worse, the mantra that Utah has been doing more with less is starting to prove untrue as test scores have been slowly but surely been ticking down over the past decade.
One thing is clear, Utah can not claim it is a pro-family state when it continually falls short on education performance. It is also clear that under-educated children turn into under-educated employees, and under-educated employees bring less money to households and the state. It is also clear that money isn’t the only answer to fixing Utah’s education problems and that $1,500 is a lot of money for a family to no longer receive as part of an annual benefit – and $1,500 only assumes two children in a household, it is not unusual to see families with 3, 4, 5, or more children under the roof. This reduction could have a dramatic effect on family budgets.
Ultimately, however, those with children are the ones who are directly benefiting from a strong public education system. Though the initial sticker shock may be difficult for families to swallow, as budgets adjust, the benefits of a higher quality education system are long lasting.
For lawmakers to pass such legislation will require quite a bit of courage as they explain their vote to their constituents. Jones, for her part, has decided that she will not be running for reelection in November – for her, it is clear that she is interested in forcing the debate on public education funding. It is near certain that this legislation will not pass, but by putting people on the record, Jones is holding lawmaker’s feet to the fire.
To contact Senator Jones, click here or call 801-278-7667.
Impact on Average Utahn:
High Impact 5 . 4 . 3 . 2 . 1 . 0 No Impact
Need for Legislation:
Necessary 5 . 4 . 3 . 2 . 1 . 0 Unnecessary
Sound Legislation 5 . 4 . 3 . 2 . 1 . 0 Clunker