Cox’s $30.6B budget targets Social Security tax, nuclear power, school safety

SALT LAKE CITY — Utah Gov. Spencer Cox unveiled his proposed $30.6 billion budget for the next fiscal year Thursday, which proposes eliminating the state tax on Social Security benefits, investing in nuclear power and implementing school safety legislation passed earlier this year.

Cox described the budget as a “return to normalcy” that represents a “modest” but “healthier type of growth” for the state coming off of several years of federal COVID-19 stimulus. After approving $1.2 billion in tax cuts through his first term — primarily through reductions of the income tax rate — the Republican proposed eliminating the state’s tax on Social Security benefits, something he said will impact about 150,000 retired Utahns who are living on fixed incomes.

“We have an aging demographic out there, and that silver tsunami — as boomers are starting to retire — is something that we’re concerned about,” Cox told the KSL and Deseret News editorial boards Wednesday. “We’re behind the national curve on that because we’re a younger state, but we’re certainly heading in that direction. … They struggled as much through inflation — maybe more through inflation than anybody else — those who are on a fixed income.”

Utah is one of only nine states that taxes Social Security benefits, and Cox said his budget would save about $950 per year for the average filer — a total of $143.8 million across the state. Lawmakers had set aside some $200 million to cover a proposal to eliminate the state sales tax on food, but that effort was tabled after an accompanying constitutional amendment was struck from this year’s ballot.

That amendment would have ended the educational earmark on income tax, and without it, Cox is proposing to use that money that was set aside to offset eliminating the Social Security tax as well as expanding the state’s child tax credit to cover children who are younger than 1.

Nuclear energy

With growing demand for energy due to Utah’s growing population and the emerging artificial intelligence industry, Cox in October announced the ambitious Operation Gigawatt to double the state’s energy production over the next 10 years. His budget proposal would lay the first seeds of that project, by investing $20.4 million in nuclear power and another $4.3 to boost geothermal production.

Cox is hopeful that the incoming Trump administration will make good on its promise to fix the federal permitting system for nuclear energy, which the governor said is “broken.”

“It’s all very problematic right now,” he said. “We know we can do this stuff. We built 130 of these (nuclear power plants) in 10 years from 1967 to 1977, and then we stopped building.”

He said permitting is the primary roadblock preventing more nuclear power from being brought online but praised Sen.-elect John Curtis’ efforts on that front and said he’s “optimistic that we can move the needle.”

Because nuclear power has been out of fashion in recent decades, Cox said much of the expertise in building nuclear generators is aging, giving the state a “window of opportunity right now to actually fix this and get it right.”

It’s unclear where a future nuclear power plant might be based in Utah, but Cox said the $20 million proposed investment would largely fund site work in hopes of incentivizing future private investment. The governor said he has had initial and ongoing conversations with the leaders of neighboring Idaho and Wyoming about coordinating efforts on the nuclear front to benefit all three states.

Education

Cox’s proposal includes funding for K-12 education and the state’s higher education system. While lawmakers have pushed for budget cuts to higher education, Cox’s budget doesn’t request any cuts, but it does ask higher education leaders to reevaluate the need for certain degrees. The budget also asks for $2.5 million to increase capacity at technical schools and $2 million for a pilot program to design general education curriculum to develop better critical thinking skills and civics.

The governor said he is “very supportive” of the effort to reorient higher education programs to promote the workforce needs but wants to see money saved by cutting programs reallocated to bolster other degrees.

“A 10% reallocation is really what the discussion is honing in on,” Cox said. “That money would be set aside as programs are eliminated, then it can be used to facilitate additional programs.”

He said he thinks higher education has “lost their way across the country in very important ways,” and said many higher learning institutions are “more in the advocacy business than seekers of truth.”

While he believes the institutions have become too ideological, “we can’t go too far the other way” when trying to fix the problem, he said.

“These are taxpayer-funded universities; that’s what we’re talking about,” he said. “Taxpayers — citizens of Utah — are putting their money into these universities … which means the people who are funding these universities have a say in what gets there. How do they have a say? They have a say through their elected representatives.”

Cox’s proposed budget also includes about $130 million to help K-12 school districts implement school safety measures passed last legislative session. Asked about which piece of the budget proposal he is most worried about, Cox pointed to the school safety funding.

“The one that keeps me awake that is in there is the school safety piece,” he said. “That’s the one, you know, every governor just waits for that phone call.”

The funding would help schools implement various school security measures, including technology to remotely lock the doors of the school and potential remodels of certain schools to limit the deadliness of an active shooter.

Cox — who has advocated for schools to ban cellphones during class time — also requested $3.7 million to help schools purchase pouches where students can leave their devices while class is in session.