With crossover day behind us and most major pieces of legislation in place, the Senate began work on the FY 2021 budget this week, presenting their version of the budget bill in the Senate Finance Committee.
The Senate has made a number of changes to the Governor’s proposed budget, both on the revenue and spending side, and reflecting bills that have passed the Senate.
The Senate has passed five tax and revenue bills that will affect the amount of revenue available in the FY 2021 budget, reducing revenue by a total of $12.4 million. These bills include state incentives for consolidating local governments (SB 138), a new business tax credit (SB 755), and a tax credit for foreign income taxes paid (SB 170).
The Senate has also passed a number of bills that would increase spending in the FY 2021 budget. The largest of these, SB 648, would expand Medicaid to include dental coverage, at a cost to the state of $11 million, but would draw down $51 million in federal funding. Other bills increasing spending include creating an Intermediate Court of Appeals (SB 275), and judicial (SB 597) and magistrate (SB 653) pay raises.
Beyond the bills passed by the Senate that increased spending, the Senate also included spending increases for a number of programs throughout the budget above the governor’s recommendations. These spending increases total $10.9 million, and included increases in the Department of Commerce, DMAPS, and DHHR, as well as adjustments to the School Aid Formula and some programs in Higher Education.
Since the Senate reduced revenue by $12.4 million, and increased spending by $33.4 million, the Senate also has to make some cuts to the Governor’s budget proposal. And cut they have, taking the budget knife to many of the governor’s proposed spending increases, including cutting $10.5 million from the governor’s Jobs and Hope initiatives, $4 million from his tourism increases, and $10 million from the governor’s proposal to clear the Intellectual/Developmental Disabilities Waiver wait list. Under the Senate’s cuts to proposed funding for the I/DD Waiver, the DHHR would only be able to clear half of the waitlist, leaving hundreds of families remaining without services.
The House will begin work on it’s version of the budget this week as well, and the two versions will have to be reconciled and a balanced budget sent to the governor. Stay tuned for updates as the budget continues to evolve through this process.
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