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Second Substitute H.J.R. 25

Representative Steve Eliason proposes the following substitute bill:


             1     
JOINT RESOLUTION TO END UNREPORTED

             2     
FEDERAL GOVERNMENT LIABILITIES

             3     
2014 GENERAL SESSION

             4     
STATE OF UTAH

             5     
Chief Sponsor: Steve Eliason

             6     
Senate Sponsor: Curtis S. Bramble

             7     
             8      LONG TITLE
             9      General Description:
             10          This bill strongly urges federal government action to recognize its unreported liabilities
             11      in its financial statements and enact changes that will resolve the national debt crisis.
             12      Highlighted Provisions:
             13          This resolution:
             14          .    strongly urges the federal government to recognize its unreported liabilities in its
             15      financial statements and to formally include all of its obligations in national debt
             16      computations; and
             17          .    strongly urges the leaders of the United States in the Legislative and Executive
             18      branches of government to enact changes that will resolve the escalating national
             19      debt crisis.
             20      Special Clauses:
             21          None
             22     
             23      Be it resolved by the Legislature of the state of Utah:
             24          WHEREAS, one of the most basic characteristics of financial reporting is that financial
             25      statements provide relevant and reliable information to users for decision making;


             26          WHEREAS, accounting standard setting bodies, such as the Financial Accounting
             27      Standards Board, set Generally Accepted Accounting Principles (GAAP) so that investors,
             28      policy makers, citizens, and others can have access to relevant and reliable financial
             29      information;
             30          WHEREAS, management of public companies must follow GAAP in order to maintain
             31      the confidence of investors and to avoid regulatory entanglements, legal liability, and criminal
             32      prosecution;
             33          WHEREAS, when entities or individuals have deviated from GAAP the results have
             34      brought about disastrous consequences for corporations and individual investors;
             35          WHEREAS, for example, when Enron Corporation failed, thousands of people lost
             36      their jobs and thousands of investors collectively lost billions of dollars;
             37          WHEREAS, Enron was liable for billions of dollars in obligations that were not
             38      reported on its balance sheet as liabilities, which made it difficult for analysts and investors to
             39      understand clearly the true picture of Enron's financial position prior to its collapse;
             40          WHEREAS, GAAP requires that public companies report their obligations as liabilities
             41      on the balance sheet;
             42          WHEREAS, in particular, GAAP requires that estimated retirement benefits be
             43      recognized as a liability on the balance sheet;
             44          WHEREAS, companies that have obligations to pay their current and former employees
             45      for health care and retirement benefits are required to recognize and report these obligations as
             46      a liability on their balance sheet;
             47          WHEREAS, the United States government has an obligation to pay citizens' future
             48      retirement benefits and health care benefits, primarily through Social Security and Medicare;
             49          WHEREAS, United States taxpayers are rightfully entitled to these benefits because
             50      taxpayers regularly contribute Social Security and Medicare premiums to the federal
             51      government through payroll deductions;
             52          WHEREAS, the United States government does not currently include most of its
             53      obligations for retirement and health care benefits as liabilities in its financial statements;
             54          WHEREAS, the amount of reported federal debt is staggering;
             55          WHEREAS, as of the end of fiscal year 2012, total reported liabilities of the United
             56      States, including debt held by the public and debt held by the United States government, were


             57      approximately $16 trillion;
             58          WHEREAS, noted professor and accountant Robert D. Allen, Ph.D., writing for the
             59      Journal of Accounting Education in 2013, observed that "it took more than 200 years -- from
             60      the time of George Washington until 1982 -- to get to $1 trillion in gross federal debt. In the
             61      last 30 years gross federal debt has increased by an additional $15 trillion";
             62          WHEREAS, the amount of unreported federal debt is even more staggering;
             63          WHEREAS, estimates of additional federal government liabilities not formally
             64      included as part of the federal debt range between $48 trillion and $70 trillion;
             65          WHEREAS, the Government Accountability Office predicts that the amount of federal
             66      debt, both reported and unreported, will continue to increase over the next two decades as the
             67      baby-boomer generation continues to retire;
             68          WHEREAS, formally recognizing unrecorded liabilities is an important step that will
             69      help the United States Congress and the public to better understand the extent of the problems
             70      associated with the national debt and deficit spending; and
             71          WHEREAS, formally recognizing these liabilities as part of the national debt will also
             72      place Congress and the public in a better position to evaluate spending priorities and make
             73      equitable spending decisions in the future:
             74          NOW, THEREFORE, BE IT RESOLVED that the Legislature of the state of Utah
             75      strongly urges the federal government to recognize its unreported liabilities in its financial
             76      statements and to formally include all of its obligations in national debt computations.
             77          BE IT FURTHER RESOLVED that the Legislature of the state of Utah strongly urges
             78      the leaders of the United States in the legislative and executive branches of government to
             79      enact changes that will resolve the escalating national debt crisis.
             80          BE IT FURTHER RESOLVED that a copy of this resolution be sent to the President of
             81      the United States, the Majority Leader of the United States Senate, the Speaker of the United
             82      States House of Representatives, the Financial Accounting Foundation, the Government
             83      Accounting Standards Board, the Financial Accounting Standards Board, the Congressional
             84      Budget Office, the Government Accountability Office, and the members of Utah's
             85      congressional delegation.


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