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Senate advances senior prescription credit after amendment, debate over constitutionality and fiscal impact
Summary
Senators adopted a Tax Commission amendment and passed SB 99, a prescription credit/refund program for low-income seniors (maximum $600), while members questioned fiscal notes and whether the approach conflicts with the constitution’s dedication of income tax revenue to public education.
The Utah Senate on Friday adopted amendments and advanced SB 99, a measure to provide tax credits or refunds of up to $600 for low-income seniors who spend more than 5% of their income on prescription drugs.
Senator Bartle, sponsor of the bill, presented amendments prepared by the Tax Commission and said the revised fiscal note puts the program cost at approximately $2,634,000. "Fortunately... it was our impression that this bill might cost us $3,000,000 but when we got the report back from the Tax Commission, it's only $2,634,000," the sponsor said on the floor.
The proposal would operate similarly to the circuit breaker: eligible taxpayers could receive up to $600 as a credit against income tax; those without income tax liability could file for a refund of up to $600. The sponsor described eligibility as limited to residents 65 or older in the poverty-level group who have paid more than 5% of their income on prescriptions.
Several senators raised concerns. Senator Levitt questioned whether the benefit should be labeled a tax credit or rather a welfare-style refund, noting that recipients who have not paid income tax would receive state payments. Senator Hilliard pressed a constitutional question, saying the state's income tax is dedicated to public education and asking whether refunding income tax revenue to individuals runs afoul of that dedication.
"Under the constitution, our income tax is dedicated to public education," a senator said, urging caution about diverting or refunding those funds. The sponsor replied that the fiscal note had been worked through and that the Tax Commission had prepared the estimate for the amended bill.
After a call for the question, the Senate took a roll-call for third reading; the clerk announced the bill's passage as recorded on the floor (clerk announced 23 ayes with absentees noted) and placed SB 99 on the third-reading calendar.
