Legislature Approves Budget Cuts

davidwicaiBlog, Legislature

Budget cuts needed because of the COVID-19 pandemic are not as painful as originally feared, but they still will impact employees and some programs.

The revised budgets for fiscal year 2021, which passed the Legislature Thursday, will not require any layoffs, although some currently vacant positions throughout the department will not be filled. There will also not be any programs cut. That’s the good news.

The bad news is that the 2.5 percent cost-of-living raise for state employees has been rescinded for this year. But the state will cover increases in health insurance so rates will stay the same for employees.

Also, for the department, the Legislature has cut funding for the North Capitol Building that will include the new state museum and storage areas for the historic artifacts and state-owned art collection. Most likely, that project will be funded at some point through bonds. While nothing specific has been promised, legislative leaders and Gov. Gary Herbert have expressed support for bonding for state projects to help shore up the economy.

Any new money approved at the end of this year’s general session was also reversed, which legislative leaders actually decided last month and finalized during this special session.

All told, the cuts could have been much deeper. Although many state agencies were cut at the 5 percent level, the overall budget cut for the state was less than 2 percent because of immediate needs that were funding in education and social services.

Of course, there could be more cuts, especially if the pandemic explodes in the fall. But it may also remain manageable enough that businesses can stay open and furloughed workers can return to their workplace, which will help tax revenues.