Senate approves first substitute to constitutional amendment on trust‑fund payouts; sponsor says schools would get more money

The Utah Senate approved the first substitute to Senate Joint Resolution 2, a proposed constitutional amendment that would change how income from trust lands tied to public education may be treated. The first substitute passed on a roll‑call vote, 23–1, with five senators absent, and the clerk placed the measure on the third‑reading calendar.

Sponsor Senator Hilliard (recognized on the floor to present the substitute) framed the proposal as a narrow change to remove a constitutional requirement that mandated reinvesting enough income to keep up with inflation. "By taking this, by making this amendment, my understanding is we'll about double the amount of money in interest that'll go to the local schools," Hilliard said on the floor, arguing the measure would let the Legislature direct more of the trust income to current students rather than preserving all returns as added principal.

Hilliard walked colleagues through the trust's history, saying the state received roughly 7,000,000 acres of trust land at statehood and now holds about 3,000,000 acres. He said the trust fund grew from roughly $17–$18 million in the mid‑1980s to approximately $350 million today and that a substantial portion of returns comes from equity growth rather than traditional interest or dividends. Hilliard also said the body should interpret the constitutional term "interest" to include other income from trust assets, such as mineral leases, grazing permits and timber revenues.

Several senators pressed for numbers and cautioned about long‑term impacts. Senator Hickman asked whether distributions to local schools would be "very significant," and Hilliard said his understanding was they would roughly double and that he would provide exact figures the following day. Senator Allen asked for clarification about Hilliard's cited "$60,000,000" figure and asked that Mr. Alder (the investment official referenced on the floor) be available to explain the calculation. Senator Betters reiterated concerns that taking more income now reduces the annuity-like growth of the principal and could short future funding even if it helps short‑term needs.

Senator Hilliard closed by pointing to a prior constitutional amendment the Legislature passed — allowing the state to guarantee local school bonds — as an example of a targeted constitutional change that yielded savings for districts. With the first substitute approved, the measure will proceed to a third reading on the Senate calendar.