This month’s interim session was filled with hot topics and big-time decisions. Not only did a normal interim session convene to review and prepare upcoming legislation, but Gov. Gary Herbert called a Special Session to vote on catalytic Inland Port and tax changes. This blog shortly explains what makes the interim session important, and provides interim committee and Special Session highlights.
What Makes the Interim Session Important
Monthly interim sessions are where issues, bills, experts, and legislators all come together in committee meetings to address, prepare and work specific state policy issues. Mostly, interim committees review and recommend bills to be voted upon in the upcoming General Session. Many times interim committees review commissioned studies and expert opinion which inform whether or not legislation should be recommended for the General Session. In special circumstances, a Special Session is called to vote on specific legislation. For more information regarding the specifics of an interim session, check out this blog post.
Inland Port Changes in Special Session
Changes to the controversial Inland Port also passed during the Special Session. The House voted 62-5 and the Senate voted 22-2 on the changes. The state and members of the Salt Lake City Council worked together to change the 20,000-acre development planned in the city’s northwest quadrant. The new boundaries removed wetlands and other environmentally sensitive areas, removed the area under the jurisdiction of the Salt Lake City International Airport, and set aside 10 percent for affordable housing. This bill also better defined the rules governing the newly created Port Authority Board and how they will interact with the normal zoning ordinances of Salt Lake City. Lastly, it defined where the property tax revenues will go, and better defined how the Port Authority will work with the tax entities (cities and school districts) within their boundaries.
Revenue and Taxation Interim Committee & Tax Changes in Special Session
The Revenue and Taxation Interim Committee discussed tax bills that were to be voted on in the Special Session later that afternoon. The Committee was responsible for providing recommendations to their respective bodies on the legislation. At the end of the day, the legislature made the needed tax code changes following the South Dakota v. Wayfair, Inc. Supreme Court ruling that allows states to collect sales tax from some online sales. Implementation of collecting sales taxes on most online purchases will begin January 1, 2019. The State budget analysts estimate this will add an additional $60 million in annual tax revenue. Two tax cuts were also passed during Wednesday’s Special Session. One cut states that businesses will not be taxed on manufacturing equipment that wears out in three years. The second cut implements a child tax credit to partially offset the recent federal changes that created a tax increase on middle income families with three or more children.
Economic Development and Workforce Services Interim Committee
Housing affordability is a current and crucial issue for Utahns and their state legislature. However, with great challenges come great opportunity – opportunity Utah legislators and interest groups are exploring to address the state’s housing affordability concern. Rep. Joel Briscoe proposed a $100 million bond which would incentivize developers to create housing for individuals 50 percent or below area median income. The Utah League of Cities and Towns proposed updating city zoning ordinances to allow for more individualized affordable housing across communities. Lastly, the Governor’s Office of Economic Development updated legislators and the general public on the Opportunity Zones Program.
A recently passed federal program, the Opportunity Zones Program identifies low-income areas in states, and provides capital investment opportunities in these areas to prospective businesses. This program hopes to invigorate new business projects in low-income areas across the nation. Of the 8,700 opportunity zones across the United States, 181 are registered in Utah.
Public Utilities, Energy and Technology Interim Committee
Utah has a unique economy that represents all industries: aerospace, agriculture, business services, construction, healthcare, hospitality, telecommunications, manufacturing, mining and energy. Utah hopes the energy industry will boost its most rural counties’ economies. Some of these rural counties are currently experiencing an economic retraction instead of economic expansion like the rest of the state. According to the Governor’s Office of Economic Development (GOED), Duchesne County minerals and energy jobs have dropped 20 percent, and has a current 10 percent unemployment rate. This economic retraction bodes danger to the state’s long-term vibrancy as counties’ struggle to flourish.
Luckily, many energy companies are seeking project opportunities in these counties. In this month’s interim session, Ormat technologies, Utah Associated Municipal Power Systems, Utah Mining Association, GOED, and the Governor’s Office of Rural Development (GORD) presented energy plans and projects to help boost these rural areas. These plans and projects have the capacity to create at least 8,030 jobs in rural counties.
*These are just two highlights from the special session and three of many meetings that happened on the Hill last week. Visit le.utah.gov for a full listing and audio of all interim committees, or check back here next month for more interim updates. As always, reach out to our public policy team with specific questions or ideas. We are willing to help answer questions and share the Chamber’s policy positions on topics.