Week 3 of the 2026 Utah Legislative Session marks a pivotal point at the Capitol, with just days remaining for appropriation subcommittees to finalize their recommendations to the Executive Appropriations Committee. Budget decisions are coming into sharper focus as lawmakers weigh priorities and tradeoffs that will shape the final spending package.
At the same time, legislative activity remains intense, with more than 800 bills already numbered, reflecting both the fast pace and the high volume of policy proposals moving through the process.
We want to thank our Chamber members for their partnership and engagement as we shared concerns with legislative leadership and the Governor regarding H.B. 161, Property Tax Modifications, and H.J.R. 7, Proposal to Amend Utah Constitution – Property Tax Modifications. We also appreciate the sponsor’s willingness to engage in dialogue and consider feedback. We have since been notified that both measures have been placed on hold while lawmakers explore other approaches to reducing the property tax burden for all property owners, residential and commercial alike.
The Chamber will continue to participate constructively in these conversations as discussions move forward and as broader, long-term property tax solutions are evaluated.
The Chamber is closely tracking nearly 200 bills with potential impacts on Utah businesses and their workforces. Thank you for following along and for your continued engagement as we work to advance policies that support a strong, competitive economy for all Utahns.
Noteworthy Bills to Watch
R&D Tax Credit: (No Bill Number Yet)
- The Utah House is considering a proposal to decouple the state’s tax code from the federal Research & Development (R&D) provisions in H.R. 1, the One Big Beautiful Bill Act, a move that could significantly increase the cost of innovation for Utah businesses and affect investment decisions across several key industries.
Background:
- The federal R&D tax credit was created in 1981 to encourage companies to invest in innovation and new technologies in the United States.
- For decades, businesses could pair the credit with immediate deduction of R&D expenses, which helped cash flow and reduced the risk of investing in new ideas.
- A delayed provision in the 2017 Tax Cuts and Jobs Act required R&D costs to be spread over several years beginning in 2022, increasing upfront tax liabilities, even for companies continuing to invest heavily in innovation.
- This change made innovation more expensive, especially for small and growing businesses, which is why restoring immediate R&D expensing has become a major concern for the business community.
Concerns:
- Utah has several industries that rely heavily on R&D investment, including life sciences, manufacturing (including transportation and advanced manufacturing), aerospace and defense, making this issue especially important to the state’s economy.
- Because R&D investment is highly portable, increasing the cost of innovation risks pushing research activity, jobs and long-term growth out of Utah and into more competitive states.
H.B. 203 S1, Non-Compete Amendments, sponsored by Rep. Tyler Clancy
- STATUS: The bill was substituted and received a favorable recommendation from the House Business and Labor Committee (10-3). It is now on the House Third Reading Calendar. The Chamber continues to work with the sponsor on potential changes.
OVERVIEW:
- This bill significantly tightens Utah’s non-compete rules by expanding the circumstances under which the non-compete agreements are unenforceable and by adding new employer compliance requirements.
- This bill prohibits the enforcement of non-compete agreements against:
- Nonexempt employees
- Interns and students
- Minors
- Employees earning under $155,000 annually
- Independent contractors
- Traditionally, broad restrictions on non-compete amendments have made it more difficult for employers to protect investments in talent, training and sensitive business information.
S.B. 211, Tort Amendments, sponsored by Sen. Kirk Cullimore
- STATUS: This bill received a favorable recommendation from the Senate Judiciary Committee (7-1) and is on the Senate Second Reading Calendar.
OVERVIEW:
- This bill would:
- Limit what juries can hear about insurance and paid medical bills. In most tort lawsuits, juries would no longer see evidence that a plaintiff’s medical bills were paid, discounted or written off by insurance or public programs. Damages would be considered without reference to those collateral payments.
- Prevent settlement decisions based on discounted medical costs. Defendants, including insurers, could not reduce settlement offers based on the lower amounts actually paid for medical care. This may lead to higher claim valuations in negotiations and at trial.
- Increase potential liability exposure and insurance costs. By limiting the use of collateral source evidence and restricting settlement leverage, the bill could increase damage awards and claim payouts. Insurers may respond by adjusting underwriting or raising premiums, which could ultimately increase insurance costs for Utah businesses.
S.B. 241, Early Literacy, sponsored by Sen. Ann Millner
- STATUS: This bill is scheduled to be heard today by the Senate Education Committee at 3:40 p.m. in Room 210, Senate Building.
OVERVIEW:
- This bill would:
- Establish a statewide framework to strengthen early literacy instruction in kindergarten through third grade.
- Require the use of evidence-based reading instruction aligned with the science of reading.
- Require benchmark reading assessments to identify students needing early intervention.
- Expand reporting of literacy assessment results to parents and educators.
- Align educator preparation programs with science-based reading instruction requirements.
- Improves coordination between K-12 schools, higher education and the State Board of Education to improve early literacy outcomes.
- This bill is important to the Chamber because early literacy is foundational to long-term workforce readiness, economic mobility and sustaining a strong talent pipeline across all industries. It reflects priorities identified through the Chamber’s Utah Rising initiative and aligns with the work of the Chamber’s foundation, Utah Community Builders, which focuses on strengthening communities and addressing root causes that affect workforce participation.
Bills on the Horizon (Just Numbered):