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House approves first substitute to let counties match severance-tax dollars into stabilization trusts
Summary
The House passed the first substitute to House Bill 370, allowing counties to receive matched portions of severance tax revenue—capped by property valuation—for county tax-stabilization trust funds; the principal is tightly restricted and principal withdrawals require a county-wide vote.
The Utah House on the floor approved the first substitute to House Bill 370 on severance tax revisions, sending the measure to the Senate after a unanimous recorded vote.
Representative Mathis, sponsor of HB 370, told the House the substitute makes technical changes at the request of the Division of Finance to allow severance tax dollars to flow to county tax-stabilization trust funds on a capped, matching basis. "What this bill does is takes a portion of the severance tax and on a matching controlled basis allows the counties to feed their tax stabilization trust funds," Mathis said on the floor.
Under the substitute the state may contribute a share of severance tax receipts—up to a cap tied to county property valuation—matching county property-tax contributions. The bill allows counties to use interest earned from those trust accounts as general-fund revenue; the principal may be accessed only if a majority of the county’s electors vote to permit such use, a high threshold sponsors emphasized.
Representative McGee asked whether there are restrictions on how proceeds could be used; Mathis replied that "the only thing that can be used out of this tax stabilization trust fund is the interest and it will just go into the general fund to meet the basic needs of the county," and that principal access requires a 51% vote of county electors.
Sponsors framed the bill as a limited, capped mechanism to smooth boom-and-bust revenue swings in resource-dependent counties. The House recorded 65 yes votes, 0 no votes and 10 absences on the first substitute; the bill now proceeds to the Senate.
The House also noted staff guidance and that unspent severance tax amounts would roll back into the state general fund if counties do not use the matching option.
