July 29, 2004

We concluded with $106 million surplus in our general fund and Uniform School Fund combined. In addition, we had $13 million in our transportation fund. Of course, when you look at all the needs across the state, it isn't enough to cover everything that needs to be funded.

Reporters (in order of appearance):

KEN VERDOIA, KUED
TOM JORDAN, METRO NETWORKS
DAN BAMMES, KUER
LEE AUSTIN, UTAH PUBLIC RADIO
BRYAN SCHOTT, KSL RADIO
JOSH LOFTIN, DESERET MORNING NEWS

Transcript:

KEN VERDOIA, KUED: Governor, thanks for joining us today. We've just concluded one fiscal financial year for the State of Utah. We've now started the next. There are some indicators that show the economic news for Utah is upward ticking, that we're moving in a positive direction. Can you give us a snapshot of how the state concluded the year and where we are now?

GOVERNOR WALKER: Very positive news. We concluded with $106 million surplus in our general fund and Uniform School Fund combined. In addition, we had $13 million in our transportation fund. Of course, when you look at all the needs across the state, it isn't enough to cover everything that needs to be funded. But that's where the surplus is. We'll have to look at projections as we move into formulating the budgets for the next go-around. But it was positive news. We started to see that increase back in November, and we've been adding jobs, over a thousand a month, which is a little over 2 percent, which is quite remarkable after losing jobs in the previous two years.

KEN VERDOIA, KUED: We're in July, which gives you several months to prepare a final budget for your administration.

GOVERNOR WALKER: Right.

KEN VERDOIA, KUED: What do we do with this good news?

GOVERNOR WALKER: Well, we look at it. We have to realize that that surplus, that 50 percent of the general fund money goes into the rainy day fund. And that's good news for Utah because we need to rebuild that reserve fund. And 25 percent of the income taxes go into the Uniform School Fund automatically by law. And that's good news, because in both cases those reserves need to be built back up.

It means, however, that there won't be money for every program or every need out there. We have a lot of built-in increases such as the school population. I can't tell you the number they've projected for the '06 school year, but beginning in September we'll have 7,160 new students in our public school system, or in that area. And we'll have that growth in the next budget, the '06 budget, and even beyond that.

Medicaid is increasing every year in double digit figures. Retirement costs, benefit costs, seem to be ever escalating. And right now it seems like we've got a lot of money when you say $106 million. I can tell you with the things that I mentioned, that money will disappear in terms of basic needs in the '06 budget.

TOM JORDAN, METRO NETWORKS: Is there any reason to think that there's been motion on trying to get something established in the way of permanent school funding that will take care of the problem down the road? Do you see any motion in that direction?

GOVERNOR WALKER: Well, actually, we have -- our whole income tax is dedicated to the public school system. Let me change that. In previous years it has. We've had a constitutional amendment in the mid 90's that allowed it to be used for higher education also. But it's dedicated to public education. Certainly with the numbers of students coming in, we'll have to look at the funding. And one of the reasons that we are looking at tax reform is to look and see if we have the proper structure for the future of Utah.

DAN BAMMES, KUER: Governor, an incumbent member of the Utah State's Board of Education will not be on the ballot this fall because the state board that is charged with selecting candidates for you to nominate for this position failed to include him in that group. And so simply his tenure on the State Board of Education is over. Does this, in your view, point out a flaw in the way we nominate candidates for the State Board of Education?

GOVERNOR WALKER: Oh, I was as surprised as you are that he was not included, because if an individual has been elected by the people and without apparent cause not to be selected to be on the ballot again for a second term seems to me to be quite remarkable. I haven't met with that selection committee to say what, "Were you thinking?" But obviously they had reasons, and I don't know what they were. But the process is that I get three people and I select two out of those three. We did interviews with every individual. We had a group of people that sat in on those interviews, and I had to make a decision selecting two out of the three. But I was surprised that that individual was not included, because, as I understand it, he's been a very valuable asset to the State Board.

DAN BAMMES, KUER: This group that nominates candidates includes by statute five members from the education community and five people from the business community. Should a nominating process for an elected office like State Board of Education include by law members of specific interest groups?

GOVERNOR WALKER: We've been looking at how we select candidates for the school boards for many years. I remember one of the first pieces of legislation I carried was to have a lottery on how the State School Board names were placed on the ballot, because everybody that was on the State School Board whose name began with an A, B, or C except a McConkie that was appointed. So we've been struggling to try to find the most appropriate way to select State School Board members, because they're statewide and they're not always very visible offices, and they should be, but people tend to ignore who's on that until they get to the election booth. So we're still working on it, and I think we need to re-look at it.

KEN VERDOIA, KUED: Governor, following up on this question, we'll turn to Logan and a question from Lee Austin of Utah Public Radio. Lee?

LEE AUSTIN, UTAH PUBLIC RADIO: Actually, I was going to move to a slightly different topic. You can go back to the education reform bill, I suppose. We're heavily into a campaign year now, and I was wondering if you could clear something up for me, the question of endorsing Republican political candidates this fall -- Jon Huntsman, Jr., for example. Is it your intent to make no endorsements at all in the campaign or to wait for some period of time?

GOVERNOR WALKER: Oh, I'm a Republican and I certainly believe in the Republican principles. But basically I just want to spend as much time as I can being the best governor I'm capable of being. And we have a lot of initiatives out there that we're working on we're trying to get into place so that they can continue on in the future. I recognize that the new governor will have his own initiatives, but there are some things that we think are going very well. And my feeling was that I'm not going to spend a lot of time out on the campaign trail endorsing candidates, but certainly I believe in the Republican principles and will support generally Republican candidates.

DAN BAMMES, KUER: Governor Scott Matheson, Jr., the democratic candidate for governor, is quite fond of citing your education initiatives in his campaign. And the education plan that he outlined, he cited Olene Walker three or four different times. Are you comfortable with that?

GOVERNOR WALKER: Well I think we've made some progress. I think one of the things that he was referring to was the reading program. And, you know, across the state I'm seeing signs that it may be effective. I got off of a plane, and as I came in front of the aeronautics building two busloads of Jordan School District students were getting off. As- - and I told security, "Stop so can I talk to them." As I walked over there, one child yelled out, "It's the governor who makes us read!" And I thought that was the best reward I've had in terms of pushing the fact that the most important 20 minutes of your day reading with a child. And so if that has been successful, and we're seeing some indications that it has been, then I'm delighted that candidates of either party are willing to step up and continue that effort.

BRYAN SCHOTT, KSL RADIO: Governor, back to the issue of endorsing a candidate. You don't have to go out on the campaign trail, you just have to say, I support this person, I support that person. You seem to be dancing around the issue of whether you're going to come out in support of Jon Huntsman, Jr.

GOVERNOR WALKER: Oh, oh.

BRYAN SCHOTT, KSL RADIO: It just seems like you're very loathe to throw your support behind one candidate or the other, and I don't see how working on your initiatives will take away from that.

GOVERNOR WALKER: Well, and I'm hoping I'm making a generic statement that I will support Republican candidates.

KEN VERDOIA, KUED: Governor, let me follow up with an old adage, and the old adage is this: "Judge me not by my words but by my actions." And what you seem to be indicating through your term of service is that at times there may be too much of an emphasis on partisan politics and less of an emphasis where it should be placed, which is on the building blocks of building a better state. Is that a fair read of Olene Walker?

GOVERNOR WALKER: That would be a great read. I would be honored to have that read out there. I hope that I haven't become a typical partisan individual, because I hope that I've had the vision and sharing of people across the spectrum, irregardless of political parties or issues. I've worked very hard on issues that some might say are democratic issues, like homelessness, affordable housing, even education. These are issues that should be across the board.

And on the other hand, and I feel that I'm a very fiscally conservative individual. I've struggled with budgets. I don't want to increase taxes. I think that we've got to look at the foundation but even there we're trying very hard to keep it revenue neutral, because I don't want to increase taxes. I want, though, to have a sound structure on which we can move into the 21st century, and that's the objective. And I've been very pleased with the polls that have been done showing an approval rating almost across the board, and I'm very proud of that.

JOSH LOFTIN, DESERET MORNING NEWS: Governor, a special session has been discussed previously --

GOVERNOR WALKER: Yes.

JOSH LOFTIN, DESERET MORNING NEWS: -- for September. We're hearing that now maybe legislative leaders are backing off of the necessity of a special session and instead just maybe let the new governor and new speaker and new senate president take over and get their policies pushed through. Is that special session still being planned on, or --

GOVERNOR WALKER: We're discussing it. We're looking at several issues. I would certainly want a very limited number if we do find it necessary, but we're looking at several issues that different legislators have brought up or issues that may have some technical aspect to it. Those will be all considered and a decision made.

TOM JORDAN, METRO NETWORKS: Governor, I have a slightly rambling question here on the subject of marriage, since we'll be dealing with that on the election. I've been married 32 years, and I can imagine some -- perhaps some threats to my marriage, but they wouldn't come in the form of two guys who want to hang out together. You've had a long and happy marriage, certainly not threatened by a couple of gals who get along together. It has sort of led me to think of kind of, sort of a two-part question. One, whose marriage is being threatened by these rascally gay people, and two, since marriage is an institution that's been here for four or five thousand years in all cultures around the world, why in Utah right now is it so fragile that it needs government protection?

GOVERNOR WALKER: I think it isn't just in Utah. I think it's across the United States that we're seeing many states debate the issue. We have a statute that says basically the same thing that's in the constitutional amendment. However, there is some differences that we need to look at, and I think that would require some technical legal analysis of it. But I think that this was voted in by the Legislature. Ironically, the governor has no part of that process. Anything that is passed as a constitutional amendment goes directly to the people, and they'll decide in November.

JOSH LOFTIN, DESERET MORNING NEWS: Speaking of the ballot initiatives there's one that didn't quite make it, the Open Lands Initiative, and they're now fighting it in court. Do you think the initiative law as it stands now is a fair way for citizen initiatives to be able to put on the ballot?

GOVERNOR WALKER: Generally, yes. I don't think that people understand it officially, though sometimes there are some issues that become very difficult. And once we went basing it on senate districts, we have some complex issues of how do you get the general public who are gathering names to understand that in some counties you can have three or four different senate districts, and to get the right number in that particular district is very difficult.

I don't know what to base it on. We have determined that basing it on the county is not a good equal proposition where one person, one vote counts the same if you go by county. Because when you compare Daggett with other counties, it just doesn't work out. Going by senate district seemed to solve the problem, but again you have this question where you can have three or four districts adjoining each other and it's hard for those that are gathering names to make clear where those exact lines exist.

DAM BAMMES, KUER: Governor, you were planning to come out with a tax reform package next week that could be a big part of your political legacy. Could you give us a preview of what's in it, the general principles that you’re try to work with, and how you think it will be received.

GOVERNOR WALKER: Well, our general principles have always been that it's fair, just, and simple. Secondly, that it has to maintain a business friendly atmosphere. Third, it has to have structural balance. And by this I mean that it has to meet -- have revenues sufficient to meet the basic obligations of the state. It has to have a balance between the state level and the local level so that both entities can have a chance to meet their obligations. And fifth, it has to have a chance of passing the Legislature. And that may be the most difficult one of all.

We will roll it out in August. It won't be the first of August, but it will be later in the month that we'll roll it out. And we recognize that such reform is very difficult, and we expect to take it all over the state, to have people analyze it, discuss it, and perfect it. And certainly critical to this process is the Legislature. Certainly they will have to take time to analyze it. There will be some major political ramifications. And anytime a proposal is put out that has significant political aspects to it, it often takes time for people to fully understand the ramifications. So it may be a long process before action is taken, but certainly we will put forth proposals in the month of August.

TOM JORDAN, METRO NETWORKS: Are you hopeful that on sort of a large scale that it will reduce taxes and increase revenue?

GOVERNOR WALKER: You know, that's an oxymoron. How do you reduce taxes and increase revenue? You just can't do both of those. We're trying to keep it revenue neutral. And certainly getting the necessary data and information has become a major part of that when you're trying to make it revenue neutral. And we're doing that because we want people to look at the policies and the structures, and if we were to increase taxes in any way, that would become the issue, not the basic policy questions that need to be discussed.

KEN VERDOIA, KUED: Governor, I want to return to an earlier theme that we were exploring, and that is education. Professionally, you've had a life long commitment to education, serving education. Certainly in your public service you've had a keen interest in public education. And at every turn, from talking with you, you seem to encounter what might be described as a suspicion that is afoot of public education, that there is a hard-to-define segment in Utah and perhaps in the nation that is very suspicious of public education -- the questions, motives, questions what its ends and means are. Have you in fact encountered such suspicion out there, and how do you try to counteract it?

GOVERNOR WALKER: I think there will always be that concern among some of the people. I think that it exists because the majority of our budget goes to education. And so it will always be at the very top of the priorities of legislators to discuss. And the fact that we have a third more kids in our public school classrooms than the average state will always put tremendous budget pressure on the Legislature as they're trying to fund all the things that are needed in the state. And education is something that everybody is an expert on. Everyone that's been through the system or has a child in the system is somewhat of an expert on it and feel that it can be improved in this way and that. And I guess my plea has always been, we've got to involve everyone in our educational system, that we've got to work to maintain a quality educational system. And with the numbers coming in and with the demographic changing of those numbers, that it's going to be even more difficult in the future. And so we've got to look at the structure of how we handle our budget, how we get the revenue.

Certainly I think overall Utah has had a remarkable education system. We have a lot of dedicated teachers and administrators. Obviously I'm not happy that we're number 50 in our per-student expenditures. We're also number 50 in the number of administrators we have. But we have to live with that and make certain that we overcome those obstacles, because education is our future.

KEN VERDOIA, KUED: As the quietude settles in amongst us, I wanted to follow up with a different area. There has been increasing public awareness of the impacts of the drought and need for wise water management for the future. Many people in southern Utah are pinning their hopes on the development of Lake Powell's water supply, even though that lake is at a low level right now. Do you support the creation of a pipeline that would allow Utah to more fully utilize its share of the water that's stored at Lake Powell?

GOVERNOR WALKER: Absolutely. I think we've got to look in the very near future at the planning process to get our allocations out of especially the Colorado and the Green River. Because as I look at the future, those are the main resources that we have for the future of Utah. And ultimately the growth in Utah will be determined I think by water. And so I think that we need to start the planning process to get our allocation out of those rivers, because the needs will be great.

Washington County is growing at a phenomenal rate. Certainly if we could get additional water out of the Green River to pipe it to the more urban areas, that's essential. And we always have agriculture needs, and perhaps that's an area that has the greatest need in this drought.

I'm very proud of the people of the state. We are conserving water. Our record this year is far better than last year or the year before. So we need to compliment the people, but also we need to recognize that we can do even better on conserving water and the wise use of water. We've also got to develop secondary systems and prioritize how we use the pure, pristine water.

KEN VERDOIA, KUED: And one final question in our last minute here today in the news conference. In one of your initiatives you try to breakthrough the impact of wilderness, something you've been working on day in and day out. Have you been able to make any progress? And again, we only have about one minute left.

GOVERNOR WALKER: We are making progress. I think it's going quite well in Washington County. And again, I want to compliment all of those people who are at the table and who have committed to stay at the table. We have many other counties that are willing to start the process, and so I'm very pleased with it. The purpose will be to get a process in place that maybe we can continue in the future to solve the problem that's been with us so long.

KEN VERDOIA, KUED: Governor, thank you very much. A reminder that a transcript of this and every Governor's News Conference, including on-line video streaming, is available courtesy of the Utah Education Network at www.uen.org. Until we gather again next month for the next news conference, thanks for joining us. Good evening.

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