One of the first things that makes news headlines during the legislative session is the process of enacting a batch of legislation to establish what is known as the “base budget,” which the Utah Legislature will finalize this week for fiscal year 2022-23. To put it succinctly, the base budget is the starting point for negotiations on the final state budget, and it would become the final state budget should those negotiations ever fail to reach consensus.

While quirky and obscure, the base budget is also important. The base budget typically represents about 97 percent of the final state budget enacted by the Legislature. In other words, decisions regarding the overwhelming majority of spending of taxpayer dollars are being made as part of the base budget process.

One of the most significant duties of the Utah Legislature is to establish and fund the budget of state agencies and operations. The Utah State Constitution explicitly addresses the revenue side of this equation: “The Legislature shall provide by statute for an annual tax sufficient, with other revenues, to defray the estimated ordinary expenses of the State for each fiscal year.” State law governing state budgeting addresses how the Legislature appropriates funding to programs and agencies to determine their budgets.

The base budget for state programs or agencies is usually based on the previous year’s budget for a given state program or agency. Exceptions include programs like public education, which in 2020 was granted a special provision that adds projected growth in public school enrollment and inflation to the public education base budget.

The practice of base budgeting is relatively new, having begun less than 20 years ago. The base budget process was created because, in 2004, Utah Gov. Olene Walker threatened to veto the entire state budget in order to get a priority issue funded by the Legislature.

The concern that the annual session might conclude without a final budget in place led lawmakers to establish the base budget process and prioritize it at the beginning of each legislative session. To ensure that prioritization, the Legislature is required to pass or defeat all base budget bills by the 10th day of the session.

Less than 10 years ago, the Legislature re-emphasized that prioritization by tripling the amount of committee time dedicated to producing base budgets during the first 10 days of the session. This was designed to allow legislative budget committees to examine each line item of an agency’s or program’s base budget, to ensure it was being spent most effectively.

It is worth noting that even though the base budget could become the final budget in certain circumstances, that has not happened yet. Every year that base budgeting has been in place, the governor and the Legislature have reached consensus on a final budget before the end of each legislative session – despite any political or policy disagreements.

Even though this contingency has never materialized, the base budget process continues to serve important civic functions. It gives lawmakers the opportunity to deeply scrutinize the spending of more than 9 in 10 taxpayer dollars and to understand where taxpayer dollars are going, and why.

So, the next time you see a news story reporting on the base budget, know that it means lawmakers are in the process of deciding where most of your state tax dollars will be spent. If that fact inspires or motivates in you a desire to impact those decisions, then find out which budget committees your state representative and state senator serve on and let them know how you think tax dollars in those areas should (or should not) be spent.