The Appropriations Committee started off the week with a presentation from the Bureau of Finance and Management. They presented an overview of the governor’s budget from her December presentation.

The governor reassessed the ongoing revenues that were adopted in March. Her projection is that there will be a decrease of $5.9 million from what the Legislature approved at the end of last session. Decreases are projected to be in sales and use tax, contractor’s excise tax, insurance company tax, unclaimed property tax, and licenses, permits, and fees. She recommended that other funding of $7.7 million and transfer from the budget reserve of $16.7 million be available for one-time funds in 2020.

She is recommending ongoing receipts of $48.1 million more over revised FY2020 for the 2021 budget. The new $48.1 million of ongoing revenue would be as follows:

• sales and use tax, $36.6 million,

• lottery, $3.6 million,

• contractor’s excise tax, $4 million

• insurance company tax, $4.6 million,

• unclaimed property tax flat for an increase, license, permits & fees $.1 million,

• tobacco taxes decrease of $1.8 million

• and other ongoing receipts of $1 million.

The state will be experiencing an internet tax freedom act loss from federal legislation that accounts for a $20 million loss to the state. Taking the internet tax loss of dollars, $20 million, the proposed decrease in tobacco taxes of $1.8 million and the current year revised ongoing revenue growth of $5.9 million, the total ongoing revenue growth available for 2021 is $22.7 million.

Sales tax reported by remote sellers is $17.5 million more from 2018 to 2019. This refers to the online sales that we are now collecting sales tax. The governor is amending the 2020 General bill with the following general fund decreases:

• DSS operations of $8.4 million reduction in general funds related to a decrease in medical services, child care direct assistance, and utilization changes;

• State Aid to education revision of $3 million in general funds due to a total need changed in reduction of 393 fewer student and sparsity adjustment, and local effort change due to higher property valuations;

• DHS operations a decrease of $2.7 million in general funds due to reduction of 30 FTEs and $631,000 due to the right sizing of the hospital for DD in Redfield and reduction of $2.2 million from nursing home budget;

• CHC 340 B program which is a prescription purchasing program used by Corrections which decreases $1.1 million in general funds due to the reduction of prices for drugs used by the inmates;

• Dual Credit is a decrease of $764,000 in general funds due to lower-than-projected dual credit enrollments;

• The technical institutes formula was decreased by $44,000 in general funds due to updated full-time equivalent student numbers which showed 122 less students than projected;

• DOC had a decrease of $397,000 in general funds due to a reduction in budget for service contracts on correctional health care medical equipment and savings from the 340 B program;

• Various other decreases were $53,000 in general funds for DOE state assessments due to reduced utilization;

• Decrease of $50,000 in general funds in DPS to align Victims’ Services budget with anticipated expenditures and decrease of 21K in general funds in the Technical Institutes to align the personal services budget to anticipated expenditures.

The FY2020 general bill amendment for increases are as follows:

• DOC operations of an increase of 1.5 FTE and $1.6 million in general funds in the following areas:

— 1.5 FTE and $510,000 for the maintenance of STAR academy in the Hills,

— $751,000 for a new food contract,

— $196,000 for parole agents,

— $156,000 for security staff

— and $60,000 for Inmate Services Corrections Analyst;

• State Employee Health Insurance increase of $1.5 million in general funds amount necessary to structurally balance the State Employee Health Plan;

• UJS Drug/DUI Court Treatment increase of $445,000 in general funds for funding to pay for treatments costs for offenders who participate in the drug and DUI courts, and funding covers the increased costs for current participants, not an expansion of the program;

• State Property Tax Administration System increase of $225,000 in general funds to create a state property tax system which will streamline the management of property tax data between county officials and DOR, will increase the accessibility to statewide property tax data for tax payers and in the future the DOR will research development of an online property tax tool kit for tax payers that integrates GSI data;

• Suicide Prevention increase of $210,000 in general funds: $135,000 in the DSS to provide mental health trainings and a public awareness campaign and $75,000 in the DOH to support community prevention efforts and provide training to high risk professions;

• ATG of $90,800 in general funds with $25,800 for equipment for Child Abuse Coordinator and $65,000 to rewrite the statewide automated victim information notification software (SAVIN);

• LRC operations increase of 1 FTE and $87,900 general funds for a lead software engineer and to align the budget for legislator salaries and per diem for FY2020;

• LRC redistricting software for an increase of $75,000 in generals to purchase mapping software for the FY2021 redistricting project;

• SOS online voter registration/circulator badge program for an increase of $60,000 and various other increase of $39,800 in general funds in the Technical Institutes for National Guard Tuition base on the actual claims, increase of $9,500 for statewide utility adjustments, and an increase of $7,400 for the State Auditor’s office to upgrade to VOIP phones.

Two last 2020 general bill amendments for expenditure transfers are $5.1 million for state radio infrastructure and systems upgrade and $5 million for rural broadband expansion for a combined total of $10.1 million. Stay tuned as some of these items are already being debated in the budgets that were presented this week.

I am trying to do daily updates on the highlights of the departments that we are hearing budget requests from on my Facebook page.

Again, if you have questions/concerns, please email or call 660-5619.

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