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Overview of the Georgia State Revenues and Budget
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  1. Overview of the Georgia State Revenues and Budget Senate Budget and Evaluation Office Slides are up to date as of 4/29/10. Please note that numbers are subject to change and more information become available.

  2. FY10 Revenue Story • In March 2008, the General Assembly passed HB990, the FY09 General Budget, that assumed $20.1 billion in revenue collections. Final FY09 revenues were actually $16.77 billion. • In January, the Governor proposed a FY10 budget based on $18.5 billion in revenues (3.23% over the original FY09 Amended revenue estimate and 8.20% below HB990). However, this revenue estimate would have been 10.23% over the final FY09 revenues. • In February, the Governor lowered the estimate to $16.99 billion, and this estimate formed the basis of HB119, the FY10 General budget (2.64% below a reduced FY09 Amended revenue estimate and 15.6% below HB990). This revenue estimate was 1.36% over the final FY09 revenues. • In November 2009, the state bond documents show a revised draft revenue estimate of $15.7 billion, a $4.4 billion shortfall from the original HB990 (6.2% below FY09 actual revenues and a 22% decline from HB990) • In January 2010, the Governor’s revenue estimate for the FY10 Amended Budget was $15.5 billion, a $4.6 billion shortfall from the original HB990 (7.3% below FY09 actual revenues and a 23% decline from HB990) • In March 2010, the Governor revised his revenue estimate for the FY10 Amended by $340 million to $15.2 billion. This is a $4.9 billion shortfall from the original HB990 (9.3% below FY09 actual revenues and a 24.4% decline from HB990)

  3. FY10 Amended Revenue Estimate

  4. FY11 Budget – As Passed • The FY11 revenue estimate reflects a 17.9% decline from the original FY09 General budget of $20.1 billion or a $3.6 billion shortfall. • The FY11 budget recognizes several sources of new revenue including: • $288 million in funds from the securitization of funds in GEFA • $96 million in funds from user fees • $229 million in funds from the hospital provider payment • $23.5 million in funds from passing legislation on the streamlined sales tax • $40 million in funds from increases in tax compliance and fraud prevention • The FY11 budget is based on 4% growth over FY10

  5. Reductions in FY11 • The median cut to agencies in the Conference Committee version of the budget is 7% from FY10, with a cumulative cut of 18% from FY09. • Spending overall has declined by 12.5% from FY09 and is projected to decline by 16.6% by 2012.

  6. Reserves at $103.7 million

  7. Dynamic Items in the State Fiscal Outlook • Revenues are likely to start turning positive in the months to come • By recognizing new revenues (fees, hospital fees, deferral of sales tax exemptions, streamlined sales tax changes), the General Assembly has expanded the base over which revenues can grow. • The General Assembly also passed tax cuts which will off set growth in revenues. • Budget contains funding for tax compliance officers/fraud detection staff projected to bring in around $141 million in the coming year ($64 million was budgeted in FY11) • Other forms of federal stimulus being discussed/problems passing stimulus that FY11 budget requires

  8. Future “Holes” in the Budget • State Health Benefit Plan • Medicaid • Difficulty predicting the ABD shortfalls because of backlogs of SSI applications at the federal level • State Employees Retirement System • Growth in K-12 and Higher Education • Behavioral Health