Gasoline, airfare costs driving inflation in Utah

Rising transportation costs have driven inflation across the state this summer. In June alone, Utahns paid approximately 4 percent more for a gallon of gasoline than they did in May, and airfare costs increased by nearly 18 percent this month.

According to the Zions Bank Wasatch Front Consumer Price Index, transportation costs in the state, which are up 2.7 percent month-over-month, were pushed higher in June by the rising gasoline prices. Utahns paid approximately 13 cents more for a gallon of gasoline on average in the month of June than they did in the month of May. According to the AAA, this put Utah in the spot for the eighth-highest gasoline prices in the country.

In most states, average gasoline prices fell about 20 cents in June as gasoline inventories swelled to their highest levels since 1992 due to increased domestic production across the nation, according to the national CPI.

Although the increased price of gasoline was the chief driver of higher transportation costs, airfare costs also contributed by jumping nearly 18 percent this month. During the summer months, travel routinely increases, and because of this, airlines are more likely to increase prices.

According to the Wasatch Front CPI, during the last 12 months, overall prices in Utah have increased by 1.6 percent. In comparison, prices across the United States have increased at a rate of 1.8 percent year-over-year, according to the national CPI. Utah Business

The impacts of public transit on traffic

Average highway congestion delays increased 47 percent when public transit service was not available.

While some have questioned the benefits of mass transit systems, which are used by only a small fraction of commuters, research by Michael Anderson suggests that transit riders likely would otherwise commute along already heavily congested roadways and that congestion along those roadways would increase if mass transit were scaled back. In Subways, Strikes, and Slowdowns: The Impacts of Public Transit on Traffic (NBER Working Paper No. 18757), he studies traffic-congestion data from before, during, and after an October-November 2003 transit-worker strike in Los Angeles. He estimates that average highway congestion delays increased 47 percent when public transit service was not available.

Public transit receives 23 percent of all federal highway dollars but represents only 1 percent of all U.S. passenger miles traveled. Federal, state, and local government subsidies for public transit exceed $40 billion a year, and cover 100 percent of capital costs. There has been relatively little research, however, on the effects of mass transit availability on the peak hour congestion experienced by commuters on different roadways within the same metropolitan area. This is because the counterfactual -- the absence of mass transit access in cities with mass transit systems -- is not often observed.

Not surprisingly, Anderson finds that while average roadway delays increased during peak hours of the transit strike, the effects were largest on freeways running parallel with transit lines with heavy ridership. His estimates suggest a total "congestion relief benefit" of the Los Angeles public-transit system of between $1.2 billion and $4.1 billion per year. National Bureau of Economic Research

The rising dollar: Green and back

Visitors to America this summer will find their money does not stretch quite as far as on previous trips. The dollar has risen this year against a broad range of currencies, so holiday purchases will be a bit pricier than usual. A strengthening dollar is a rare thing. The upward bursts in the early 1980s and the late 1990s were deviations from a generally falling trend. Since it was freed from the Bretton Woods system of fixed exchange rates four decades ago, the dollar has mostly fallen in value against other rich-world currencies. But a growing band of analysts reckon it is time for the greenback to regain a bit of lost ground.

The immediate spur for optimism about the dollar is the recent signalling from the Federal Reserve that its purchases of bonds with newly created money may start to tail off as soon as September. The prospect of an end to quantitative easing has already pushed up long-term interest rates. The yield on ten-year Treasuries has risen to 2.6% from a low of 1.6% in May. As yields rise, capital is attracted to America from riskier parts of the world. That in turn pushes up the dollar. The Economist

Lehi Roller Mills for sale: Court CRO determines assets must go

A historical community landmark-- Lehi Roller Mills SEmD is about to change ownership.

Having started the bankruptcy process in December 2012, Lehi Roller Mills owner Sherwin Robinson had said he hoped to keep the business intact by filing a Chapter 11.

Instead, the U.S. Bankruptcy Court appointed a Chief Restructuring Officer in March, Mark Hashimoto, CPA for Piercy, Bowler, Taylor & Kern.

To date, KEB Enterprises, a holding company, has offered $4.4 million for nearly all of the Lehi Roller Mills assets. If there are higher or better offers received by Aug. 13, then an auction will take place between the competing bidders on Aug. 15.

"The amount of debt we had was pretty insurmountable. The total debt was in excess of $10 million," Hashimoto said. Daily Herald

Transportation plan will result in economic growth, group says

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The key to economic growth in Utah will be continued monetary support of the area’s transportation system, according to a new report.

According to a comprehensive study conducted by the Economic Development Research Group of Boston, further state and local government investment in broad-based transportation could result in more than 180,000 new jobs over the next three decades.

The report, commissioned by the Salt Lake Chamber’s Transportation Coalition, showed that if municipal governments and transportation agencies fully implement Utah’s Unified Transportation Plan, the result would be almost 183,000 cumulative new jobs created by 2040, $130.5 million in additional household income, $183.6 billion in additional gross domestic product and $22.2 billion in additional tax revenues from economic growth.

The study quantifies the total economic value to the state if the plan is funded and implemented. The study measured the total impact of increased transportation efficiency, improved goods movement and market access, increased business creation and attraction, and construction spending impacts. Deseret News

Utahns to receive health insurance rebates

U.S. Health and Human Services Secretary Kathleen Sebelius announced Thursday that about 140,000 Utahns will be receiving a rebate this year from their health insurance company. Utah residents will benefit from more than 4.5 million dollars in rebates from insurance companies this summer, averaging 85 dollars per family.

The rebates are a result of the federal Affordable Care Act’s Medical Loss Ratio Standard known as the 80/20 rule. It requires insurers to spend at least 80 cents of every premium dollar on patient care and quality improvement. If they spend an excessive amount on profits and red tape, they owe rebates back for the difference. Insurance companies that do not meet the 80/20 standard will send consumers a notice that they are eligible for the rebate by August 1st. KUER

As housing market ramps up, so does pace of foreclosure filings

Lenders stepped up action last month against homeowners who had fallen behind on their mortgage payments, taking possession of more homes and initiating the foreclosure countdown clock on many others.

Bank repossessions jumped 11 percent nationally in May from the previous month, with monthly increases taking place in 33 states, including Utah, foreclosure listing firm RealtyTrac Inc. said Thursday.

The monthly pick up reflects a rise in homes entering the foreclosure process last year. Many of those homes wound their way through the often lengthy process and ended up becoming bank-owned properties. Overall foreclosure activity, however, was down 29 percent from May last year, reflecting the long-term downward trend. Salt Lake Tribune

New study shows financial awareness increase in Utah

Even though roughly one-fourth of Americans claim to be satisfied with their financial health, a new study shows that only 41 percent are living within their means.

The study, which was sponsored by Financial Industry Regulatory Agency Foundation, surveyed more than 25,000 Americans about their “financial health.” While much of the data exposed serious shortcomings in financial responsibility, the report also showed positive signs of improvement.
Deseret News

Paperless mortgages gaining acceptance in Utah

Closing on a house is going digital. Forget the hours of meetings with mortgage brokers and hand cramps from signing a ream of paper. Now, Utah house hunters and refinancers can apply for a mortgage from at least one key lender, submit all the required forms and documents, ask questions and even sign on the dotted line using a laptop on the living room sofa.

Mountain America Credit Union (MACU) rolled out its Quick Close paperless mortgage service as an option about 18 months ago and so far, about 500 Utahns have used it, said Amy Moser, MACU vice president of mortgage services. She says it’s a matter of convenience for customers.

David Luna, legislative officer with the Utah Association of Mortgage Professionals and president of Mortgage Educators and Compliance predicts digital mortgages will all be paperless in the near future, pointing to industries that have also gone digital such as insurance, law enforcement and pharmaceuticals. Salt Lake Tribune

New college grads are waking up to a huge debt hangover

Seventy percent of students in the college class of 2013 are graduating with an average of $35,200 in credit and student loan debt. Only 30% are graduating debt-free.

If they had a better understanding of debt when starting college, 39% said they would have made different choices. That's a 14% jump from the same survey in 2011.

Likely thanks to the crushing blow of the Great Recession, more students said they considered the "hireability" factor of different majors –– 57% said they picked their major based on their prospects of finding a high-paying job.

When it comes to paying for college, the earlier you start to strategize and save, the better. There are useful tools out there, many of which can be found at the Consumer Financial Protection Bureau's website, which has a page just for students.

For pre-college students, check out their guide to paying for college.

For new graduates saddled with debt, check out this guide on how to start paying off your loans.

Business Insider

UPS plans on more natural gas‐powered trucks, stations

United Parcel Service Inc. said Tuesday it plans to buy about 700 natural gas-powered tractor trailers and build four refueling stations by the end of next year.

The logistics company is investing more aggressively in natural-gas vehicles and natural-gas infrastructure given that natural-gas prices are 30% to 40% lower than imported diesel and the U.S. natural-gas production is gearing up, UPS said.

The company has more than 1,000 natural-gas powered vehicles on the road worldwide, part of a fleet of around 2,600 alternative-fuel vehicles, which also include electric hybrids and all-electric vehicles.

The company already has 112 tractor trailers out of stations in Nevada, Arizona, and Utah, and has its own LNG fueling station in Ontario, Calif., it said. Market Watch

Higher Education, Merit‐Based Scholarships, and Post‐Baccalaureate Migration

Fifteen U.S. states currently have broad-based college merit scholarship programs (including Utah). Based on either high school grade point averages or scores on college entrance exams, these in-state tuition scholarships are awarded to at least 30 percent of each state's graduating high school class. In total, the 15 states spend about $2,191 per recipient or $1.4 billion per year. The aid programs appear to slightly increase the probability that residents born in the state live there after college, but they may also decrease the probability that people attain a four-year college degree.

In the NBER Working Paper No. 18530, co-authors Maria Fitzpatrick and Damon Jones use Census and American Community Survey data to track college attendance, college completion, and residential decisions of 24-to-32 year olds between 1990 and 2010. National Bureau of Economic Research

Measuring College Prestige vs. Cost of Enrollment

The cost of a college education these days ranges from expensive to obscenely expensive. So the decision is likely to be tougher and more emotional than most parents and children imagined as they weigh offers from colleges that have given real financial aid against others that are offering just loans.

While some students will be able to go to college only if they receive financial aid and others have the resources to go wherever they want, most fall into a middle group that has to answer this question: Do they try to pay for a college that gave them little financial aid, even if it requires borrowing money or using up their savings, because it is perceived to be better, or do they opt for a less prestigious college that offered a merit scholarship and would require little, if any borrowing? It’s not an easy decision. New York Times

Utah bankruptcies down in Q1, but struggles linger

A lot fewer Utahns are filing for bankruptcy these days, but behind those numbers are plenty of families still struggling to make ends meet in a state that claims one of the best economies in the nation.

David Sime, clerk of the U.S. Bankruptcy Court for Utah, reports that bankruptcy filings by Utahns dropped 14 percent in the first three months of 2013, compared with the same period a year ago. Salt Lake Tribune

State-by-state costs of health care

Today’s Wall Street Journal has a story and graphics on state-by-state costs of health care. Compiling data from the Centers for Medicare and Medicaid Services, the Census Bureau and the Centers for Disease Control and Prevention, it shows that Massachusetts is the most expensive state and Utah is the cheapest. Wall Street Journal

Buyer Beware List

The Buyer Beware List is maintained by the Division of Consumer Protection (a division in the Utah Department of Commerce) to:

(1) protect consumers from individuals and businesses who have engaged in deceptive practices;
(2) supply consumers with pertinent information so as to aid them in their decision making; and
(3) encourage the development of fair consumer sales practices.

This list is comprised of those individuals and businesses that have been found by the Division to have committed deceptive practices or other violations and have failed to comply with the Division's order to pay a fine or other order. Consumer Protection

Click here to view a list of current scams that the Division has investigated or been made aware.

Many Americans fail to grasp health care reform

A survey done for InsuranceQuotes.com by Princeton Survey Research Association International found that 90 percent of Americans don’t know when they’ll be able to start shopping for insurance through the exchanges, and only 10 percent say they’re very knowledgeable about the federal Patient Protection and Affordable Care Act.

But that information should get out soon because state and federal agencies will use “aggressive” communications campaigns to publicize open-enrollment dates and other significant information. The campaigns likely will include print ads, social media initiatives, TV commercials, billboards and community outreach, she says.

But the health care reform law is complicated, and Amy Bach, executive director of the nonprofit consumer group United Policyholders says consumers who put off learning more about their options might end up pressed to make an important decision in a short time.

To avoid being in that position, consumers might want to consider these four tips for shopping under the new system:

Learn about the law. If your knowledge of the health care reform law is shaky, there’s still time to learn. Consumers can start by visiting healthcare.gov.

Start shopping early. If you don’t have health insurance, or if you bought individual insurance but want to switch plans, you’ll need to go shopping.

Be detail-oriented. Consumers should find out exactly what different plans cover and should carefully add up costs, including deductibles and co-pays, before deciding which plan is the best fit.

Choose carefully. Consumers should get help from several sources when trying to decide on a health plan, Bach says. For example, she recommends consumers talk to an experienced health insurance broker. Insurance Quotes

Utah stock index lifted by market surge

A stock market surge that saw the Dow Jones industrial average hit an all-time high during the first quarter of 2013 also greatly benefited the shares of Utah’s publicly held companies.

The Salt Lake Tribune/Bloomberg Index, which tracks the share-price performance of Utah’s largest publicly held companies, rose 12 percent during the first quarter of this year, hitting a record of 395.90 on March 26. Its performance beat the 11 percent gain of the Dow and the 10 percent climb by Standard & Poor’s 500.

Nationally, investors seemed to be particularly focused on buying shares of companies with high dividend yields, such as those found in the health care, consumer staples and utility sectors, Sterling Jenson, regional managing director for Wells Capital Management in Salt Lake City said.

And that seemed to play out among Utah companies as well.

Utah’s top performer during the first quarter was USANA, a multi-level marketing company that sells nutritional and personal health care products. Its shares were up 47 percent. Salt Lake Tribune

How the Great Recession changed our spending habits

For the vast majority of Americans, the shock of the Great Recession lingers —and that’s a good thing in terms of how most folks are managing their money. In a new survey from Fidelity, nearly half of respondents say even now they are saving more, reducing debt and building an emergency fund.

A new survey from Principal Financial finds that the number of workers preparing for retirement is on the rise and that most workers who expect a tax refund plan to save or invest it, or pay down debt. Before the crisis, people commonly cited going on vacation and buying big ticket items as well.

Perhaps most telling, the Fidelity survey found that 78% of those who have taken steps to shore up their finances say the measures are part of a new and permanent personal financial strategy. “The sheer number of people who say the changes are permanent was probably most surprising,” says Ken Hevert, vice president of retirement products at Fidelity.

People are moving from scared to prepared, Hevert says. When the financial crisis hit, 64% said they were scared and 45% said they were prepared; today, 45% say they are scared and 61% say they are prepared — a near perfect reversal. In general, those who feel prepared are the ones who have cut debt, increased savings and built an emergency fund. TIME

Utah child care getting harder to find, more costly

A report released Wednesday by the U.S. Census Bureau says more Americans are similarly being creative as day care costs —even when adjusted for inflation — have nearly doubled in the past 25 years.

In constant 2011 dollars, it said families with an employed mother and children younger than 15 paid an average of $143 a week for child care in 2011, up from $84 in 1985.

The report, "Who’s Minding the Kids? Child Care Arrangements: Spring 2011," says that is a big issue because during a typical week in spring 2011, 61 percent of all children under age 5 were in some type of regular child care arrangement.

The national study notes that families that do spend money on child care paid about 7 percent of their income on it in both 1985 and 2011 — but fewer now are paying for it. The percentage of families paying for child care declined from 42 percent to 32 percent between 1997 and 2011.

A series of tables released with the report indicates Utah is going against the national trend when it comes to availability of paid child care options outside the home.

The number of child care facilities declined from 34.5 per 1,000 Utah children in 1997 to 23.1 per 1,000 in 2007. That is a contrast to the national picture, in which child care facilities grew from 28.8 per 1,000 children in 1997 to 37.1 a decade later.

Utah ranked fifth lowest among the states in 2007 for the number of day care facilities available, ahead of only Hawaii (15.6 per 1,000 children), Nevada (17.4), South Carolina (21.4) and Arizona (22.2).

The study said that in the face of higher costs nationally, more families are moving toward using grandparents and fathers for child care.

The report said self-care is more common among children in junior high than elementary school. Five percent of children ages 5 to 11 (1.3 million) and 27 percent of children age 12 to 14 (2.9 million) regularly cared for themselves. Salt Lake Tribune