Gov. Butch Otter has sent a budget revision to the Legislature, as the state economist’s general fund revenue projections had been finalized. It shows even more growth than had been anticipated – 5.3 percent in fiscal year 2018 over 2017, and 5.3 percent in 2019 over 2018, up from 4.6 percent. While the state would see more than $40 million in increased revenue as a result, by state law, the increased revenue in 2018 all will be transferred to the Budget Stabilization Fund, the state’s main rainy-day account, Otter’s budget director, Jani Revier, told JFAC this morning. That means no change on the bottom line for fiscal year 2018, while the 2019 ending balance rises by more than $40 million.
Between the larger transfer to the stabilization fund and the governor’s recommendation to transfer $32 million to the Public Education Stabilization Fund next year, Idaho’s reserve funds would come up to $445 million, Revier said.
The state also could see some additional costs that would require supplemental appropriations, she warned, including whether and how Congress reauthorizes the Children’s Health Insurance Program; an unexpected increase in claims costs to the Catastrophic Health Care Program in the last couple of months; and the Idaho Department of Correction’s move to ship excess state prison inmates out of state.
IDOC informed the governor last week that it will need to send inmates out of state as soon as possible, as prisons overflow, Revier said, at a cost of up to $900,000. “While there is not enough information available for the governor to make a formal funding recommendation at this point,” she said, Otter is recommending that the cost “be taken from the projected ending balance.”
With the many uncertainties, she emphasized, it’ll be prudent to leave an unspent ending balance when setting state budgets. Otter’s budget recommendation, after the revisions, shows a projected ending balance for the current year, fiscal year 2018, of $155.9 million; and for next year, fiscal year 2019, of $110,873,600.
House Appropriations Vice Chair Rep. Rick Youngblood, R-Nampa, asked about the big surge in state tax revenue that came in in December, running $47 million ahead of forecasts. Revier said state economists believe a large portion of that is simply a matter of timing – people were prepaying taxes in tax year 2017, because of the federal tax law changes, and that’s likely to mean lower than expected collections later in the year, including the crucial big-revenue month of April.