But proposal faces skepticism in the Utah Senate..
Another big piece of Utah’s budget came into focus on Wednesday as lawmakers took the wraps off a $2.26 billion transportation and construction funding package. That includes $1.4 billion in bonds for transit and construction projects.
Leaders in the House think this could be the largest transportation spending plan in the state’s history. But, Senate Republicans are not yet convinced borrowing such a large amount of money is prudent right now.
“In a year when we’re flush with cash, you have to ask whether it makes sense to bond right now,” said Assistant Senate Majority Whip Kirk Cullimore, R-Sandy.
Cullimore acknowledged, however, that the state’s rapid growth is a good argument for borrowing to meet some of those more urgent needs.
Those bonds, if approved, would pay for several projects, including $200 million to “double-track” the FrontRunner commuter rail system in order to increase capacity and add more trains during peak hours. Lawmakers also propose adding another $100 million in one-time cash to pay for the expansion.
Schultz says investing in the commuter line will entice more people to use public transit, with the added benefit of reducing pollution and improving Utah’s air quality.
HB433 also includes hundreds of millions of dollars to pay for transportation projects that have already been prioritized by the Utah Transportation Commission. Some $621 million is earmarked for several road construction or improvement needs around the state
It may seem odd that there’s a push to borrow money for construction projects at this time. After all, lawmakers have an extra $1.5 billion dollars to spend this year, most of it coming in one-time money that is usually put toward construction. A good chunk of that cash will probably will go towards buildings, mostly on college campuses. Last spring legislators cut nearly $1 billion from the budget as a hedge against the coronavirus pandemic. That included more than $300 million for building construction. Those funding requests are back this year, along with several new proposals.
On Thursday, Senate Republicans threw some cold water on the bonding idea, suggesting a more cautious approach may make more sense.
“My gut is still queasy right now about our situation. I still think there’s an economic cliff out there and I worry about that,” worried Senate Majority Leader Evan Vickers, R-St. George. He believes the federal stimulus money pouring into the state in response to the pandemic may give lawmakers a false sense of financial security.
“We have record one-time money right now. We’ve got a lot of money we can use for our infrastructure projects and those kinds of things,” he added.
It’s been several years since the Legislature authorized a large bonding package, although leaders shifted about $500 million in spending for the new Utah State Prison from cash to bonds last year to free up money during the pandemic budget cutting. Schultz says this is a prime opportunity for the state to invest in these projects, especially with interest rates hovering around 1.5%.
“We’re on a downward spending trend on transportation projects because we’ve run out the bond we issued a few years ago. We’re spending less on roads, and with the end of the prison construction and the end of the airport construction, this is really the perfect time to put some money towards some infrastructure projects,” he said.
“We have needs all across the state,” added Schultz. “That’s what I like most about infrastructure spending. This is something all of the citizens of the state can use and benefit from.”
Legislative leaders will release the full budget proposal on Friday.