Monday, January 10, 2011

Governor's 2012 Budget: Big Losers-Medicaid, State Employees

Posted By on Mon, Jan 10, 2011 at 1:59 PM

Idaho Gov. C.L. "Butch" Otter unveiled a proposed FY 2012 budget Monday afternoon, totaling $2,429,965,700, projecting a 3 percent growth for the coming coming fiscal year, which begins in July (The Division of Financial Management had projected a growth of 6.9 percent).

The bad news?
-The spending plan assumes an average 2.2 percent omnibus (across the board) reduction from almost every state agency or department. Health and Welfare would get hit with a whopping $25 million cut to Medicaid, with most cuts focused on adult Medicaid clients.
-If you're a state employee, there's a good chance you'll be hit in the pocketbook again. The governor's proposed budget doesn't include a dime for any employee raises in any agency or from any source of funding.
-The governor proposes a one-year delay for the scheduled increased of the grocery tax credit. The current credit ranges from $50-$70 and was slated to increase to $60-$80. The delay could save more than $15 million.
-Agencies or departments that could experience decreases more than than 50 percent: Women's Commission, Parks and Recreation, State Board of Education,and Veterans' Services. Decreases of 25-50 percent: Commerce, Soil and Water Conservation Commission and the Division of Financial Management.

The good news?
-Monthly revenue (tax) collections are more than $30 million above estimates.
-Unused monies have been identified in the Liquor Division ($8 million) and Permanent Building Transfer Fund ($10 million).
-More than $2 million in new spending is proposed for new math and science requirements and college entrance exams.
-$1.6 million is proposed for the Center for Advanced Energy Studies (a consortium of the three state universities and the Idaho National Laboratory).

Another important item in the governor's proposed budget: Idaho hospitals and nursing homes have agreed again to a voluntary assessment (tax) totaling $35 million to improve the state's Medicaid coffers so that they can leverage the funds and pull down more federally matched dollars. Health and Welfare Director Dick Armstrong told BW that the first-time effort for FY 2011 was a success and wouldn't be surprised to see it repeated (BW, Critical Condition, Dec. 15, 2010).

Idaho's budget writers, the Joint Finance Appropriations Committee gavels in Tuesday, Jan. 11, 2011 at 8 a.m.

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