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1 Legislative Orientation November 29, 2016

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Page 1: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

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Legislative Orientation

November 29, 2016

Page 2: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

• Room 305 - 222-2738

http://webserver.rilin.state.ri.us/House

Finance/

Senate has separate fiscal office

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Page 3: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

• Help with understanding budget

• Briefings/Caucuses

• Test feasibility of ideas

• Potential legislation

• Talking through concepts

• Fiscal notes

• Technical assistance

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Page 4: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

• Fiscal Year runs from July 1 to June 30• Current Year is the fiscal year we are in

(FY 2017)• Budget Year is the next year (FY 2018)• Actual Year is the fiscal year that just

ended (FY 2016)• Out Years are the 4 years after Budget

Year (FY 2019– FY 2022)

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Page 5: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

• Deficits or surpluses - actual or projected differences between resources and expenditures in the actual year or current year

• Budget Gaps - projected differences between estimated resources and estimated expenditures in the budget year and out years• Governor must submit a balanced budget to

the Assembly for the Budget Year

• Out Years must also be presented and provide measure of structural issues

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Page 6: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

• Cyclical economic issues arise

because the economy goes through

growth and contraction cycles,

generally around every 7 years or so

• Structural issues do not disappear

when the economy improves

• Expenditure base grows faster than

underlying economy will support

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Page 7: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

$3,000

$3,200

$3,400

$3,600

$3,800

$4,000

$4,200

$4,400

FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2021

Revenues vs. Expenditures

June 2016 Estimates

Current Useable Revenues Current Expenditures

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Page 8: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

What is it? When current expenses exceed current

revenues

Prior year surplus or other one-time resources/cuts cover the gap

Why does it happen? Short term economic events

Spending needs/wants growing faster than revenues

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Page 9: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

• Legislative grants - Assembly’s Budget

• Community Service grants - formerly in agencies’ budgets with letter of intent list –now only a few and direct appropriation

• Bonds and “Kushners”• General obligation bonds approved by

voters

• Other borrowing approved by Assembly (Kushner process = Public Corporation Debt Management Act)

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Page 10: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

• General Revenues can be used for any legitimate governmental purposes

• Taxes, lottery, licenses, fees, fines and other miscellaneous revenues

• 41% of total sources

• Federal Funds - Federal tax $$$ that must be used for purposes of the award

• Generally approximately 33% of total budget; Medicaid accounts for over half

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Page 11: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

• Restricted Receipts must be used for the

purpose for which collected as provided by

statute – 3% of total sources

• Other Funds include trust funds,

transportation fund, university and college

funds, employment security - specific

purposes - 23% of total sources

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Page 12: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

• Budget documents explaining budget and recommendations• Organized by major functions

• Budget bill (appropriation bill) converts into appropriations – must start in House• Appropriation lines, generally by

program, called line items, and are supported by 45,000 row data base

• Budget Articles amend statutes to carry out budget

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Page 13: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

General

Revenue

41%

Federal

33%

Restricted

3%

Other

23%

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Page 14: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

0 500 1,000 1,500 2,000 2,500 3,000 3,500

Federal Grants

Personal Income

Sales

University and College

All Other

Business Taxes

UI & TDI

Lottery

Departmental

Restricted Receipts

Other Taxes

Gas Tax

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Page 15: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

0 200 400 600 800 1,000 1,200 1,400

Personal Income

Sales

Business Taxes

Lottery

Departmental

Other Taxes

All Other

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Page 16: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

Gen. Govt.

16.8%

Human Svcs.

42.2%

Education

28.2%

Public Safety

6.2%

Nat. Res.

1.2%

Transp.

6.3%

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Page 17: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

Gen. Govt.

13.1%

Human Svcs.

39.0%

Education

34.8%

Public Safety

12.0%

Nat. Res.

1.1%

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Page 18: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

Personnel &

Operating

31.8%

Local Aid

14.5%

Asst., Grants,

Benefits

44.5%

Capital

7.3%

Operating

Xfers

1.9%

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Page 19: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

Personnel &

Operating

29.9%

Local Aid

30.5%

Asst., Grants,

Benefits

33.4%Capital

4.2%

Operating

Xfers

2.0%

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Page 20: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

General

Government,

2,342.7 Human

Services,

3,619.6

Education,

4,655.7

Public Safety,

3,205.6

Natural

Resources,

428.0

Transportation,

752.6

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Page 21: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

Regular 3rd Party Total

FY 2015 Avg. 13,212.7 588.3 13,801.1

FY 2016 Avg. 13,097.9 591.7 13,689.6

FY 2017 Enacted 14,206.8 745.8 14,952.6

Avg. Filled 11/16 13,104.1 597.9 13,702.0

Diff. from Enacted (1,102.7) (147.9) (1,250.6)

Diff. from FY 2016 6.2 6.2 12.4

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Page 22: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

• July 1, new fiscal year begins• Budget Office sends instructions to

agencies and departments• November – revenue and caseload

estimating conferences • Budget Office & Governor develop

current year revised budget & budget year recommendations

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Page 23: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

• Governor submits budget to General Assembly on or before 3rd Thursday in January and sponsors introduce budget bill in the House on behalf of Governor• This year it is January 19, 2017

• Newly inaugurated Governors have until the 1st Thursday in February

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Page 24: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

• Bill referred to House Finance Committee

• House and Senate Finance Committees work the budget during February, March and April through their Subcommittees

• Revenue and caseload estimating occurs again in May

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Page 25: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

• House and Senate resolve

differences

• House Finance Committee reports

budget, House passes, sends to

Senate, which passes and sends to

Governor in June

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Page 26: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

• Brief statement estimating impact of a

bill or resolution

• Current Fiscal Year Estimate

• Estimates for next 2 succeeding Fiscal

Years

• Technical or mechanical defects in the

legislation

• Approval of estimate by Fiscal Advisor

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Page 27: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

• State Fiscal Notes prepared by State Budget Officer and/or State Agencies

• Municipal Fiscal Notes prepared by Division of Municipal Finance (DOR), RI League of Cities and Towns, and/or individual municipality

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Page 28: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

• Budget Analysis

• Budget recommendation briefing

materials

• Budget as Enacted

• Local Aid and Education Aid,

Revenue Facts

• Staff Presentations to Committees

• http://webserver.rilin.state.ri.us/HouseFinance/

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Page 29: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

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Page 30: Legislative Orientation November 29, 2016 Orientation 2016- Fiscal Staff.pdf · •Legislative grants - Assembly’s Budget •Community Service grants-formerly in agencies’ budgets

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Legislative Orientation

November 29, 2016