Here’s a surprising turn of events: With April’s strong state tax revenues, if current trends hold, statutorily required transfers to Idaho’s Budget Stabilization Fund, the state’s main rainy-day savings account, will fill that fund to its statutory cap by the end of the current fiscal year. The stabilization fund, by law, is capped at 5 percent of the state’s general-fund budget. Beyond that point, surpluses would just stay in the state’s general fund.
Legislative Budget Director Cathy Holland-Smith noted that HB 345, the year-end bill sought by the governor this year, directs all year-end surpluses beyond $20 million to the stabilization fund. That now looks like it’ll mean a $58.9 million transfer to the fund at the close of the fiscal year June 30.
The fund had a beginning balance at the start of this fiscal year of $23.8 million. It also will get a statutory transfer, by formula based on state revenue growth, of $25.9 million. And then, at the start of the new fiscal year, the higher-than-expected revenues dictate another statutory transfer into the fund of $27.4 million. Add those up, and the fund will have $136 million in it. It only has $28 million more to go after that before hitting the cap, and more surpluses could materialize in May and June. “We’re looking at almost filling up the budget stabilization fund at the end of 2013,” Holland-Smith said.
Meanwhile, the Public Education Stabilization Fund will have a projected $48.9 million at the close of the fiscal year. “So if things continue the way they are, we’ll have $184.9 million in those two reserve funds,” she told the Legislative Council.
During the recession, Idaho drained nearly $400 million from its various reserve funds and the state Millennium Fund, dropping its reserves to near-zero by 2011. Now, they’re building back up.