Utah on track for another surplus — $25M to $150M

Utah expects to finish the budget year with a sizable surplus of $25 million to $150 million, and the economic outlook for the state is strong, legislative economists told lawmakers Tuesday.

That comes on top of about $253 million in growth that lawmakers built into state programs when they passed a budget earlier this year.

The newly projected surplus is driven largely by growth in income-tax collections — money that is earmarked to fund education. A rebounding housing market is also expected to contribute to the economic rebound, with about 12,000 new construction jobs anticipated between 2013 and 2015.

Higher natural-gas prices are providing a 50 percent increase in oil and gas severance tax collections. Cigarette sales are down, however, since the Legislature raised the state's tobacco tax, and those revenues have dropped by about $25 million in the past year.

Economists pointed to some causes for concern: The Federal Reserve could tighten its monetary policy, which might pinch income-tax payments and taxable sales. The rise of China as a global economic powerhouse also could play a larger role in dictating conditions in the United States.

Legislators also heard a report on a number of pilot programs implemented in recent years to help cover special treatment for children with autism.

Thus far, the programs have helped fund services for 380 children, said Michael Hales, Utah's director of Medicaid and Health Financing. Early testing has shown that those children receiving treatment for even six months show significant improvement in assessment tests.

"It's tremendous to see the services and some of the outcomes with the children," Hales said.

Another benefit, he said, is that state programs have bolstered the private-provider network.

A total of 366 children have participated in two of the programs — one funded with Medicaid dollars and the other through private donations and state money. Costs for treating those children have been considerably less than anticipated — about $23,000 per child, compared with the $35,000 that was forecast.

Senate Budget Chairman Lyle Hillyard, R-Logan, praised the work.

"What you've been able to do with the pilot program and then bringing in insurance," he said, "I think we've expanded a benefit that was very needed for a number of people."

gehrke@sltrib.com

Twitter: @RobertGehrke