Budget Forecast

A long-awaited report came to the Legislature this morning. As legislators were asked to make appropriations in this first half of the session, they made them with no information about how much money would be available. Meanwhile, state financial officers have been gathering data from all kinds of indicators in order to make their best guesses, called “revenue projections”. Everyone was watching for the revenue projections to give a better idea about how much tax money could be appropriated to government services. Those numbers came out today.

There are two sets of numbers. One set is one-time money. I am no expert but I believe that this is from Federal or other sources that can only be counted on one year at a time. The other is on-going funds based on income taxes or fees that will stay in place. Both sets of numbers show that the economy is recovering slowly but surely. There are more people employed and more taxes are being paid to cover the costs of government.

This is good news for public education and Medicaid. The Medicaid dollars go a long way to address medical needs of the most vulnerable people of the state. Each dollar spent by the state is matched two or three times in federal funding but the budget cuts have made even that commitment difficult.

Public Education won’t be asked to take cuts as deep as what we may otherwise seen. Still, it was pointed out, we have been falling behind for the past couple of years so it will take more than a small increase to get us to where we would like to be. And a small increase is what we have.

Student population growth has not been funded in the past two years and catching up will be very difficult. The Public Education appropriations committee claimed to have funded growth in the base budget but they were playing something of a shell game, moving funds from one education basket to another and calling it money for new student growth. Representative Mel Brown announced today that paying for growth would cost $60-million more than even the added revenue projections can cover. We are hearing that in order to pay for new student growth with new dollars, legislators would have to short some other areas of government, areas that are also feeling squeezed.

At least now, the legislators can now begin to divide the expected revenue more realistically.