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Senate advances user-fees reform to third reading after hours-long debate
Summary
Lawmakers advanced a bill to standardize agency fees and require reporting of $265 million in user revenues, but clashing views remained over proposed 90%/25% thresholds that would limit agencies' ability to spend excess fees.
After more than three hours of floor debate, the Utah Senate moved third substitute Senate Bill 24 — a wide-ranging measure to catalog and limit state agency user fees and dedicated credits — onto the third reading calendar on a voice vote, setting up further work and amendments before a final decision.
Sponsor Sen. McAllister urged colleagues that the bill is intended to give the Legislature “some kind of control” over fee revenues collected by state agencies, which he said total roughly $265 million a year. He described the core mechanism as a reporting requirement and two thresholds: an agency that shows dedicated credits and fixed-collection revenues exceed 90% of a program’s budget would generally keep those receipts; where revenues exceed appropriations but fall short of the 90% test, the agency would be permitted to spend 25% of the excess and the remainder would revert to the general fund.
That structure drew immediate objections from senators and agency representatives who said it would harm programs that rely on fee income but face uncertain year-to-year demand. “There are a number of agencies that are threatened by having their fines or forfeitures at risk,” said Sen. Pendleton, citing natural-resources and environmental programs whose workloads and resulting fees are inherently variable.
Sen. McAllister answered that an audit-based approach is impractical at the scale of hundreds of revenue types and that the bill is meant to curb chronic underestimates and subsequent post-hoc work-program expansions. “We need to stop that,” he said, arguing the process now inflates general-fund requests and then seeks to recapture fee revenues later.
Senators debated adjustments to the key percentages and procedural safeguards; sponsor and staff signaled willingness to consider different thresholds and carve-outs. The bill was advanced to third reading so leadership and staff can negotiate agency-specific exemptions and technical amendments before a final vote.
Next steps: The measure will be studied and amended on the way to final passage; senators asked affected agencies to meet with staff to produce specific proposals before the next floor action.
