Idaho's State Board of Examiners made it official this week - no further holdbacks will need to be imposed to balance Idaho's state budget by the end of the fiscal year on June 30. Instead, following legislation passed this year and signed into law by Gov. Butch Otter, the state will meet any year-end shortfall by dipping first into any unexpended money in the Budget Stabilization Fund; second into unspent money in the Permanent Building Fund that's now tabbed for state building maintenance work next year; and third, if needed, into the Economic Recovery Reserve Fund. None of those three funds actually have extra money sitting in them; all their funds are budgeted to be spent next year, in fiscal year 2011. But Wayne Hammon, Otter's budget chief, said some year-end reversions are expected to put unspent money back into the budget stabilization fund, and shifting building maintenance money was identified as a second step that should easily cover any shortfall.

"While building maintenance is important, people are more important than buildings," Hammon said. "For right now, they've decided that people come before buildings." The state Board of Examiners was presented with two scenarios for the year-end state budget picture: One showing a $19.6 million surplus, which is what would happen if original revenue forecasts held true; and one showing a $7 million shortfall. State tax revenues have come in short of projections, including notably in April, but came in $4 million ahead of projections in May, leaving the cumulative shortfall at $7.5 million. The state also anticipates a possible shortfall in June revenues, but expects some money to revert back to the general fund from the state's income tax refund account at the end of June, leading to the $7 million projection.

If Idaho had to take the third step laid out in the budget-balancing bill - dipping into the Economic Recovery Reserve Fund, which already is budgeted to be fully spent next year - it'd have to make cuts in next year's budget. But Hammon said that now appears unlikely. Idaho's only remaining budget reserve funds now are $17.5 million in the public education stabilization fund, which the plan doesn't touch; and $71 million in the Millenium Fund, which lawmakers and the governor chose to keep as a reserve in case a federal funding boost for Medicaid doesn't come through.