Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Severance Tax topic
No spam. Unsubscribe anytime.
Senate advances constitutional amendment to preserve severance-tax revenue for a state fund
Summary
Senators approved a third substitute of House Joint Resolution 6 to create a constitutional fund to preserve severance-tax revenue, with phased transfers beginning in 2016; questions were raised on tribal revenue treatment and how 'annual revenue' is defined.
Senator Hilliard presented the third substitute of House Joint Resolution 6, a constitutional amendment proposal intended to preserve a portion of Utah’s severance-tax revenue by placing it into a constitutional fund. Hilliard argued the state is consuming a nonrenewable revenue source and that a heritage fund — funded gradually beginning in 2016 — would create a long-term savings vehicle similar to those in Wyoming and Colorado.
Supporters described the amendment as a conservative fiscal measure to keep severance-tax receipts from being immediately spent in the general fund. Hilliard said the proposal provides a window for policymakers to prepare and that only a high supermajority would permit withdrawals later, limiting routine use.
Key floor concerns focused on how the amendment treats revenue shares with Native American tribes and the constitutional language defining "annual revenue." Senator Valentine asked whether current language on line 66 (references to two tribes) would improperly exclude other tribes should future mineral development occur on other reservations; he urged further legal review to avoid equal-protection problems. Senator Hilliard acknowledged the point and committed to provide clearer answers and statutory drafting to address inclusion of other tribes and clarification of the revenue-definition question.
The Senate approved the third substitute of H.J.R. 6 on a roll-call vote of 26 yeas, 1 nay and 2 absent. As a constitutional amendment, the resolution will require subsequent steps to reach voters for ratification.
Why it matters: the amendment would change the state’s long-term fiscal structure by reserving a share of finite severance-tax revenues for future use rather than incorporating them into recurring general-fund budgets. The change is designed to protect future state finances but raises questions about revenue sharing with tribes and precise statutory definitions.
What happens next: sponsors said they will work with legislative counsel to refine statutory language addressing the tribal and 'annual revenue' questions before further action.
