Posts tagged: JFAC
The powerful joint committee that writes all budget bills in the Idaho Legislature is also the only committee that’s never taken public testimony - but it will this year. With huge budget challenges facing the state, the Joint Finance-Appropriations Committee is scheduling two public hearings in January in the state capitol where any citizen can weigh in on two crucial areas of the state budget: School funding and health and welfare programs.
The move comes as JFAC also plans to hold unprecedented joint budget hearings with the House and Senate education and health and welfare committees in the coming session - two areas that make up the largest chunks of the state budget and where budgets are expected to be painfully tight. Among those hailing the changes is Rep. Eric Anderson, R-Priest Lake, who late last year co-sponsored an unsuccessful bill to crimp JFAC’s ability to set policy or change laws as it writes budgets. “I think it’s a really, really important step forward to basically have better access and a better review,” Anderson said. “Hopefully it runs smoothly. Honestly, I don’t want to make their work any more difficult, but I think it does answer some questions that we raised. I’m very proud of ‘em for doing that.”
Sen. Shawn Keough, R-Sandpoint, JFAC’s Senate vice-chair, said, “I applaud the co-chairs for their continued efforts to reach out for input, feedback and ideas at this very difficult economic time in our state’s history. We are all in this together.” You can read my full story here at spokesman.com.
Rep. Frank Henderson, R-Post Falls, has decided to give up his coveted seat on the Legislature’s Joint Finance-Appropriations Committee after five years to focus on economic development legislation in the coming session. “My background is economic development, it is business management,” said Henderson, a fourth-term lawmaker. In JFAC this year, with revenue so short, Henderson said, the task will be “to do more of what we did in the last two years - keep crunching it smaller and smaller. We so badly need new revenue. I want to find ways to help our existing industries - help them expand into the domestic markets, help them expand into new markets, so they can retain their present workforce and hopefully expand it, so we can get more money into the local economies.”
Henderson isn’t thinking tax incentives. “I can’t think of any tax incentives that are needed,” he said. “But I think there are ways the resources of the Commerce Department can be used more intensely.” He offered an example: A firm moved to Post Falls that manufactures a special type of ultraviolet light that’s used in industry to dry paint very quickly, in order to speed production processes. He stopped in to ask them about the market for their product. The answer: “They have a huge market in the Far East, but they don’t have a good way to access it.” Henderson put the firm in touch with the international division at the state Commerce Department. “And within five weeks, they were shipping product to Taiwan,” he said. If Commerce were out contacting Idaho businesses, it could get those same results across the state, Henderson said. “I just think they can be more aggressive.”
Henderson said he’d like to stay on the House Business Committee, and would like to move from the local government committee to the transportation committee, since he’s handled the transportation budget on JFAC for the past five years. He’d also like to be on the House State Affairs Committee. But, he said, “I don’t care where they put me - I’m still going to do economic development.”
Idaho’s Medicaid program is projecting a $42.3 million shortfall in the current year, in state general funds. Last year, the program pushed $89.4 million in bills into the current fiscal year – leaving providers waiting from three weeks to three months for payment – in order to balance next year’s budget. But if that were tried again, state Health & Welfare Director Dick Armstrong told legislative budget writers this morning, the delayed payments would then fall under the reduced federal matching rate that Idaho will see next year.
“That doesn’t mean it might not be a good strategy, but it has a significant cost attached to it that we didn’t face last year,” he told JFAC.
Looking ahead, Idaho’s facing a projected state fund shortfall for Medicaid in fiscal year 2012 of $171.6 million. That’s a huge hole, and Armstrong said it’ll likely mean cutting services. Children are protected, so “we would have to focus on adult services – that’s where we’d have to go. We would have to eliminate major categories of service.” Armstrong said “every state in the nation” is looking at the same “Draconian” type of cuts.
One suggestion he offered to cope with the crisis: Back in the ‘50s and ‘60s, there was much more use of volunteers in providing services to the disabled and others. Idaho could “see if there could be a resurgence of voluntary assistance, specifically around keeping adults stable in the home environment,” Armstrong said.
Idaho’s state budget news is bleak, lawmakers heard as they gathered today for the interim meeting of the Legislature’s joint budget committee: One in five Idaho school districts has declared a financial emergency. State prisons are managing 500 more offenders than a year ago, with $28 million less in funding. Part-time state employees already hit with furloughs and other cutbacks will face sharp increases in their health insurance premiums. And Idaho’s Medicaid program could see a shortfall so extreme it’d have to eliminate 23 percent of the health benefits it provides to the state’s poor and disabled.
“It’s breathtaking,” said Sen. Shawn Keough, R-Sandpoint, vice-chairwoman of the Joint Finance-Appropriations Committee. “I think everyone in Idaho needs to understand where we’re at, and be prepared to sacrifice in a lot of ways. They need to communicate to us what their priorities are - what can they do without in services, and what do they feel they absolutely have to have, and how do they want to pay for that?” You can read my full story here at spokesman.com.
Based on estimates of federal funding levels for Medicaid once the federal economic stimulus boost is gone, Idaho’s Medicaid program is looking at having to cut costs by $387 million - about 23 percent of the Medicaid program. Various savings efforts already are under way. But Idaho Health & Welfare Director Dick Armstrong said, “The dilemma is this: Even with all of this cost-containment activity, we are looking at a shortfall that is just extreme.” He said, “That is going to be extremely painful.”
Stunned lawmakers on JFAC had no questions at the end of Armstrong’s presentation. “I think we just all have our breath taken away already this morning,” said Co-Chairman Dean Cameron, R-Rupert. “We’ll look forward to working with you, to try and figure out a way out of this situation.”
Idaho’s state Department of Correction is managing 500 more offenders now than it did a year ago, with $28 million less in funding, Corrections Director Brent Reinke just informed JFAC. The department, he said, is working “to really try to do a much better job managing our population.” That’s included closing 150 costly state beds, including beds at the maximum security prison and the Southern Idaho Correctional Institution, in favor of less-costly housing for prisoners including new beds at the privately operated Idaho Correctional Center. Closing those state beds meant the department could eliminate 16 positions, Reinke said. However, he said the furloughs and other money-saving moves the department has been making are “not sustainable” for continuing to appropriately manage the inmate population. The state has 7,338 prison inmates, as of this morning. A relatively stable inmate population has helped lower costs.
The first report to the feds on Idaho’s federal stimulus money spending is out, and it shows that the money spent so far, $12.8 million, has created or preserved 492.58 jobs, Gov. Butch Otter’s budget director, Wayne Hammon, informed lawmakers this morning. That means it was about $26,000 per job. However, it’s not particularly illustrative - because the reports so far reflect only the money actually spent, not the money that will be spent on the projects that already have started. So those numbers will change substantially over the course of the next year.
JFAC has begun reviewing the health insurance benefits for state employees, including part-time workers who are facing big cuts next month. Legislative budget analyst Keith Bybee told the lawmakers that the executive branch is making the changes for part-timers as of the Nov. 14 payroll. Concerned state employees have sent letters to the joint committee about the hardships some part-time workers will face when their health insurance costs rise dramatically; some say they could end up with premium costs that exceed their take-home pay. Bybee said the savings from the change stay with the agency. Sen. Nicole LeFavour, D-Boise, asked if agencies have the flexibility to not make the change, “to say, ‘we’re going to lose these employees?’” Bybee said, “The agency could, in fact, raise some of those part-time employees’ pay to offset some of those premiums.” Sen. Dean Cameron, R-Rupert, thanked Bybee for presenting the information, and said, “Obviously that will be a discussion item in this next session.”
One in five Idaho school districts have declared financial emergencies, legislative budget analyst Paul Headlee just informed lawmakers on the Joint Finance-Appropriations Committee. He said 23 school districts, 20 percent of Idaho’s 115 districts, made the declaration as permitted by HB 252, legislation that passed this year. Many reduced school supplies, eliminated or reduced positions, reduced their textbook budgets, and left vacant positions unfilled; some have negotiated cuts or freezes in salaries.
As state agencies look at budget cuts and how to replace federal stimulus money once it’s gone, they’ve also been asked to look for possible new revenue sources other than the state general fund, legislative budget director Cathy Holland-Smith told JFAC as she wrapped up an overview of the state’s budget situation. If the state goes that route, a range of fees, from park fees to college tuition, could rise.
A fairly long list of supplemental appropriation requests is looming for lawmakers to consider, for everything from rising caseloads in foster care to a $13.5 million Medicaid shortfall. Those are items that need to be funded in the current year. One item on the list is a $1.97 million request from the College of Western Idaho for unexpected enrollment growth. “You potentially could be looking at enrollment caps,” Holland-Smith told lawmakers. “That’s not a direction we’ve gone to. … That’ll be something you’ll have to discuss.” JFAC members looked uncomfortable.
How bad will the state budget cuts ahead be for next year? “It’s not going to be nibbling around the edges any more,” legislative budget director Cathy Holland-Smith cautioned lawmakers this morning. “We just don’t have that type of flexibility. We’re talking about significant changes for some agencies.”