The Utah Legislature has finalized a $30.8 billion budget for fiscal year 2026 following the conclusion of its 2025 General Session. Of this total, $12.7 billion is allocated from state funds such as the Uniform School Fund, Income Tax Fund, and General Fund.
Legislators balanced the budget according to projections of available revenue, as required by the Utah Constitution.
Tax relief remains a primary focus of the state fund investments. The budget includes $103.3 million in ongoing funds and $22.6 million in one-time funding to reduce the income tax rate from 4.55 percent to 4.50 percent. Additionally, $2.0 million is allocated for a new nonrefundable tax credit for child care centers, along with $4.1 million to expand the nonrefundable child tax credit.
Other tax-related actions include $24.1 million in ongoing funding and a $1.3 million one-time reduction for the expansion of the Social Security Benefits Income Tax Credit. The budget also provides $16 million ongoing and $13 million one-time for the single sales factor apportionment of financial institutions.
Public education received significant allocations, including $178.6 million to increase the WPU Value by 4.0 percent to $4,674 for fiscal year 2026. This includes $47.4 million for an Educator Salary Adjustment and $45.2 million for the Educator Support Professional Bonus. Furthermore, $471.6 million in one-time projects was allocated from the Public Education Economic Stabilization Restricted Account.
In higher education, the budget provides $20.0 million ongoing for performance funding and $58.5 million ongoing with $55 million one-time for new building construction. Other allocations include $4.7 million ongoing and $5.0 million one-time for technical colleges, and $5.5 million ongoing for a St. George Campus of the University of Utah’s Medical School.
The budget addresses several other state priorities including affordable housing, homelessness, and employee compensation.
For affordable housing, $20.0 million was designated for the First Time Home Buyer Program and $2.0 million for the Shared Equity Revolting Loan Program. Homelessness initiatives include $1.9 million ongoing for a non-congregate family shelter and $5.5 million to support emergency summer and winter responses across the state.
Regarding state employee compensation, the budget includes $136.8 million ongoing in fiscal year 2026 and $19 million one-time in fiscal year 2025. These funds support a 2.5 percent salary increase for state and higher education employees, a 1 percent pay-for-performance bonus for state employees, and coverage for health benefit rate changes, retirement, leave pool, and long-term disability.
The Utah Legislature has provided various resources to help the public and legislators understand fiscal year 2025 and 2026 funding. These include Budget Quick Facts, an interactive DataViz tool for viewing budget changes, and the Compendium of Budget Information (COBI) for detailed budget requests and program financials.
