House Passed Their Version of 2016-2018 Budget

The full House of Representatives voted 53-0 to pass the House Democrats version of the 2016-2018 budget bill on Wednesday.

After almost four hours of debate, the bill passed with all 47 Republican members passing.  The two-year budget bill will reach the Senate chamber on Thursday, Day 50 of session, and we expect legislative leadership to begin conference committee negotiations late next week and over the weekend.  

The House also took up the legislative branch and judicial branch budgets, in addition to a revenue measure, which includes some new tax exemptions and credits that accompany the budget bill.  The House did not yet take up the state’s Road Fund.

The  Democrat-controlled House budget largely restores the current year, 4.5% cut proposed by the Governor for universities, statewide constitutional offices and other elected officials with statutory obligations. The 9% cuts proposed by the Governor will remain in tact for many agencies during the two years of the biennium, which begins on July 1, 2016.

The House version also eliminates the $100 million workforce development bond pool, indicating that the Governor’s budget staff never provided details on how that fund would be spent.  

The House appears to have utilized the “slack” in the Governor’s proposed budget to offset the Governor’s proposed cuts.  That “slack” was derived from a large surplus in the relatively flush state employee health insurance fund, (utilized in the Governor’s budget) as well as the House predicating their budget revenues on the official Consensus Forecasting Group’s forecast. The Governor’s budget assumed that receipts would fall short of that estimate, and dedicated any receipts beyond that assumption into pension systems and a new “Permanent Fund.”  The House opted to rely on a more robust revenue estimate and deleted the so called “Permanent Fund.”  The House utilized these “revenues” to fully fund the actuarially requested contribution (ARC) for both the state and teacher’s retirement systems without borrowing money, slightly reduce the state’s debt burden, and increase funding in other areas.

House Republicans had crafted their own budget bill, but they did not ultimately ask for an Appropriations & Revenue committee vote on it. During the committee meeting, they noted the differences between their version and the Democrat’s bill, but were generally complimentary of the majority party’s approach.