Budget Deal Reached: Furlough Days Averted

It’s a most unusual budget during a most unusual session of the Georgia General Assembly. The Conference Committee report on the FY 2021 Georgia state budget has been signed, and for state employees and local school systems, it’s better than expected. Given that much of the tax generating engines of the state were closed for almost 3 months, it’s better than many could have even hoped for just weeks ago.

We’ll wait until the report is published, but highlights are expected to include:

Zero furlough days for current state employees. Some agencies had proposed reduction in force (cutting positions) and those will be enacted, but state workers will not be asked to forgo pay for working or take forced days off.

Net cuts to education will be about a half billion dollars, after CARES funds have been allocated. It will ultimately be up to local school boards – who collectively have about $3 Billion in reserves – to determine pay scale and potential furloughs/staff adjustments, as employment policies and pay scales are ultimately set by local boards of education.

This budget does not include the potential of additional federal assistance that could be a focus when Congress returns to DC in July – because it can’t. This year’s “supplemental” budget that revises the FY 2021 Budget next session can adjust for additional federal funds and/or correct for changes in tax revenues from anticipated.

A note about the process behind this budget, the people involved, and the overall duties of the Georgia General Assembly:

The legislature can’t spend money it doesn’t have. It is constitutionally limited to spending only 98% of this year’s tax revenues. The budget must balance.

It is within these parameters that budget writers started with a 14% cut to this year’s budget, then grew to 11%, then to 10%. If they had just done a 10% across the board cut, this could have been done quickly without regard to impacts.

Instead, the Appropriations Chairmen – Terry England in the House, Blake Tillery in the Senate – along with their respective staffs, worked in conjunction with the Governor’s Office of Planning and Budget to figure out how to utilize every dollar available, spend nothing that wasn’t for an immediate need, and continue to deliver state services that remain in high demand despite economic activity slowing down.

I noted a wave of social media posts yesterday saying that the General Assembly just needed to pass a budget and go home. You might also note that during a lot of these floor votes, the Budget Chairmen were listed as “Excused”. They have been locked down, working every angle, and as one staff member relayed “they’ve looked under every couch cushion in this building for spare change” to minimize the impact of cuts on state services.

Yes, there’s a lot of legislation that has been debated over the last few days that won’t have the impact of a budget. This is why the legislature has a committee process. The chambers are expected to be able to work on multiple priorities at once.

But as for the budget, as we see the detail and specifics in the final bill, a note needs to be made of the work of those involved to make the best of a bad situation. You won’t see that in many headlines that will still lead with cuts, but the general readership here knows it could have been worse. A lot worse.

UPDATE: From the conference committee, some notes:

QBE has a 10% cut, but enrollment growth is fully funded.

Transportation is fully funded – BECAUSE – funds can be borrowed for capital projects per Georgia’s constitution, but cannot be borrowed for general expenses (i.e, QBE). An adjustment to the state’s bond package makes up for the drop in motor fuels taxes – which also constitutionally, can only be used for roads and bridges.

The move from 11% to 10% cuts allowed for restoration of some cuts to contract services. Chairman England highlighted several non-state programs that treat autism as examples that had funding restored just in the last 48 hours – when Governor Kemp raised the revenue estimate to the 10% cut level.

Speaker Pro Tempore Jan Jones noted that 171 of 180 school systems have more in reserves than the cuts they will receive. Thus, it is possible for almost every system to fund programs at FY 2020 levels.

Chairman England went out of his way to note that the Senate got some bad press when they passed their version of the budget with a higher level of cuts. He found much of the coverage unfair, given the situation the state’s fiscal picture is in, (and the lower revenue estimate they were working from) and again praised the work done by Chairman Tillery, who took over this process mid-session after the death of Chairman Jack Hill.