Known widely as the "Lake Powell Pipeline" bill, HB174 sponsored by Representative Patrick Painter, R-Nephi, will now go to the House floor for consideration.
Painter said his bill is not project-specific but is designed to pay for critical water infrastructure needs over the next 30 years.
The bill would take 15 percent of the revenue generated by any growth in the sales tax and raise about $72 million which would be divvied out to water districts for projects.
Dennis Strong, director of the Utah Division of Water Resources, said statewide needs over the next 15 years easily top $15 billion, including improvements to existing infrastructure and construction of new projects.
Painter's measure, already vetted and endorsed last summer by the Utah Water Task Force, is seen as the funding mechanism to promote construction of the Lake Powell pipeline, which would convey 80,000 acre-feet of water per year to Kane, Washington and Iron counties.
Critics such as the Utah Rivers Council and Citizens for Dixie's Future said Washington County water users need to learn how to conserve before they should expect a financial handout from the entire state to augment their water needs.
Others such as the Utah Taxpayers Association argued that it is bad fiscal policy to obligate future sales tax revenue for specific needs — especially in light of volatile economic times.
"An earmark is the wrong way to go about it," said Royce Van Tassell, the group's vice president said.
Painter countered that water needs are every bit as critical as demands like education and transportation — the latter of which received a 30 percent dedication of growth in future sales tax revenue endorsed by lawmakers last year.
The money generated by the sales tax allocation would go into a water loan fund established in 1947 that has made 1,400 loans to districts or other entities that have been paid back over time with interest.
Historically, Painter added, lawmakers have declared "open season" on the fund to pay for other needs in financially tough times, while water infrastructure demands have gone unmet.
"We are going to be 5 million people in about 30 years," Painter said. "We will need to put as much infrastructure in the ground in the next 30 years as we have in the last 150 years."
But Representative Brian King, D-Salt Lake, said while he agrees water needs may be pressing, HB174 goes about fixing them in the wrong way.
"It's fundamentally unwise public policy to seek to tie the hands of future legislators" with such a measure, he said.