Huntsman resigned his post in the Bush administration. In mid-August, three-term incumbent Governor Mike Leavitt, whom Huntsman strongly supported, decided not to run for re-election in order to become Administrator of the Environmental Protection Agency in the Bush Administration. Shortly thereafter, Huntsman filed papers to run for Governor of Utah. In the June 2004 Republican primary, Huntsman defeated State Representative Nolan Karras 66–34%. In November 2004, Huntsman was elected with 58% of the vote, defeating Democratic Party nominee Scott Matheson Jr. In 2008, Huntsman won re-election with 77.7% of the vote, defeating Democratic nominee Bob Springmeyer. Huntsman maintained high approval ratings as governor of Utah, reaching 90% approval at times. He left office with his approval ratings over 80%. Utah was named the best managed state by the Pew Center on the States. Following his term as governor, Utah was also named a top-three state to do business in. The 2006 Cato Institute evaluation gave Huntsman an overall fiscal policy grade of "B"; the institute gave him an "A" on tax policy and an "F" on spending policy. Depending on the methodology used, Utah was either the top-ranked state or fourth-ranked state in the nation for job growth during Huntsman's tenure, with a rate of either 5.9% or 4.8% between 2005 and 2009. The Utah Taxpayers Association estimates that "tax cuts from 2005 to 2007 totaled $407 million." Huntsman proposed eliminating the corporate franchise tax for small businesses making less than $5 million. During his term as governor, he was successful in having Utah replace its progressive income tax with a top rate of 7%, with a flat tax of 5%; cut the statewide sales tax rate from 4.75% to 4.65% and sales tax on unprepared food from 4.70% to 1.75%; and raise motor vehicle registration fees. He proposed a 400% increase in cigarette taxes, but the measure was never signed into law. In 2008, he successively proposed tax credits for families purchasing their own health insurance, as well as income tax credits for capital gains and solar projects. During Huntsman's administration, the state budget rose from $8.28 to 11.57 billion. Huntsman supported cap and trade policies, and as governor, signed the Western Climate Initiative. He also supported an increase in the federal minimum wage. He also cut some regulations, including Utah's very strict alcohol laws. In 2007, he signed into law the Parent Choice in Education Act, which he