'07 priorities take shape

BYLINE: Lisa Riley Roche and Bob Bernick Jr. Deseret Morning News

It's not yet Thanksgiving, but Gov. Jon Huntsman Jr. already has picked the place for next year's State of the State address -- the same military base at the Salt Lake City International Airport where Air Force One landed with President Bush aboard.

Work on the state budget is well under way, too, with Huntsman getting ready to reveal his spending plan in mid-December. While education will be the "heart and soul of my budget," the governor said, transportation will also be featured.

But don't look for Huntsman to try to wrap up tax reform in the budget year that begins on July 1, 2007. He said Tuesday that it could take the remaining two years of his first term, as well as a second term, to get to a 5 percent flat-tax rate in the state.

That's because it will cost $100 million to reach that rate, the governor said. In a special session last September, lawmakers adopted a flat-rate option that Utah taxpayers can choose beginning in 2007 that has a rate of 5.35 percent and no deductions or exemptions.

Huntsman said he remains committed to removing the remaining portion of the state's share of sales tax on food, even though he doesn't "want to create World War III" with lawmakers.

It was a struggle to get the 2006 Legislature to approve slicing 2 percentage points off the state's 4.75 percent share of sales taxes levied on food as of Jan. 1.

House Speaker Greg Curtis, R-Sandy, predicted the Legislature won't take any action on the food tax next session. "I'd like to take more of the sales tax off food," Curtis said. "But the Senate has made it clear they will not re-embrace that in 2007."

True, said Senate President John Valentine, R-Orem. The Senate, Valentine said, has adopted a wait-and-see attitude, so action on the food tax next session "is not appropriate. It's because we have not yet implemented the first round. We want to see the effect it has."

Both Curtis and Valentine said income tax may well be a different story.

They agreed with the governor that it will take time to finish tax reform. "We don't need to take the whole bite of the tax apple. We can work away at it over three or four more years," Curtis said. "We can tweak taxes each year for a while."

Plus, he said, lawmakers need to make sure their tax cuts don't hurt public education, something the Democrats alleged in campaign ads this election year. "Some of us won by the skin of our teeth," said Curtis, who won re-election to his House seat by just 46 votes last week.

That could help Huntsman's plans to boost education spending. "Even though we gave record money to education, did people know? We want to make sure we move forward in education funding next year," Curtis said.

Valentine, too, said lawmakers are hoping "to be able to give a very good increase to education again this year." The Senate president said that tax cuts have to be made "as revenues become available. We don't want to shortchange education."

The governor's choice of the Utah Air National Guard base located at the Salt Lake City International Airport will focus his annual January speech on the men and women serving in the armed forces.

"This year, we're going to do kind of a military theme, remembering troops, many of whom are out serving," Huntsman told the Deseret Morning News. He said the Army National Guard headquarters in Draper was considered for the speech, but the base was logistically better.

Governors traditionally deliver their annual address to the state before the Legislature in the Capitol itself. But because the domed building has been under renovation since Huntsman took office in 2005, he has chosen to speak at other sites throughout the state.

That has caused some concern among lawmakers who have grumbled about having to travel on a legislative workday. The governor's speech comes in the opening days of the 45-day session.

Huntsman gave his first State of the State speech nearly three years ago in Fillmore, Utah's territorial capital and home to his forebears. Last year, he picked a much closer destination, an elementary school in Bountiful.

Many lawmakers gathered at the base this past August to greet Bush when he arrived for an overnight visit to the state and spoke from the tarmac, in front of Air Force One. Huntsman is headed to a warmer spot, the heated base cafeteria.

The site is where Utah Guardsmen leave from for deployments in Afghanistan and Iraq and where they return from tours of duty. It is also where Hurricane Katrina refugees landed after being evacuated from Louisiana in 2005. E-mail: lisa@desnews.com; bbjr@desnews.com