Your SlideShare is downloading. ×
State Budget Outlook Wasbo Feb 17 2009
Upcoming SlideShare
Loading in...5
×

Thanks for flagging this SlideShare!

Oops! An error has occurred.

×

Introducing the official SlideShare app

Stunning, full-screen experience for iPhone and Android

Text the download link to your phone

Standard text messaging rates apply

State Budget Outlook Wasbo Feb 17 2009

295
views

Published on

Published in: Education, Business

0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total Views
295
On Slideshare
0
From Embeds
0
Number of Embeds
1
Actions
Shares
0
Downloads
1
Comments
0
Likes
0
Embeds 0
No embeds

Report content
Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
No notes for slide
  • 17% = 6100/36927 (deficit / Gov ML)23% = 8500/3692739% = 6100/ (36927*.42%)55% = 8500/ (36927*.42%)
  • In terms of proportions, low income health care and other human services represent 39 percent of the budget but represent 69 percent of the program reductions in the Governor’s proposed budget
  • K-12 is 44% of SGF$5.8 B deficit through 6/30/2011K-12 share of $5.8 B is $2.5 B (informal calculation that I will not print)$5.8 B is16% across state government…if hold K-12 harmless, about 25% (also informal, will not print)
  • Transcript

    • 1. Washington’s Financial Condition: Layperson’s View 1. What is the financial outlook and Governor’s proposed solutions? 2. What federal funding will be available to help the state? 3. What are the implications for K-12 funding? Office of Superintendent of Public Instruction
    • 2. National and State Economic Downturn • National economy has been in recession since 12/2007 • Washington lagged the downturn, and may lead improvement… • But state revenues collections will be impacted more severely b/c this is a consumer lead recession ▫ Consumer sentiment is lower than in previous recessions ▫ Taxable automotive and construction activity has dropped off sharply ▫ Other lay-off’s since October are significant: WaMu, Boeing, Microsoft • Washington State Economic and Revenue Forecast Council: www.erfc.wa.gov Office of Superintendent of Public Instruction 2
    • 3. Budget Outlook • November forecast: $6.1 Billion projected deficit for 2009- 2011 Biennium ▫ Includes revenue downturn this fiscal year ▫ Through 6/30/2011 • New preliminary forecast on February 19th ▫ Speculation that Council will announce $8.5 - $9 Billion deficit through 6/30/2011 ▫ Official forecast on March 19th • 2011-13 Biennium ▫ November forecast: economy would improve quickly ▫ February/March forecast: guessing this will be revised Office of Superintendent of Public Instruction 3
    • 4. Including the shortfall for this biennium, the Governor’s budget addressed a budget problem of over $6 billion ($6,120) Source: Senate Ways and Means Committee Staff Office of Superintendent of Public Instruction 4
    • 5. 58% of the Budget is Protected and Unavailable for Reduction Near-General State Funds; 2009-11 Biennium Maintenance Level Other Human Services 25% Basic Education 38% General Government 2.5% Other Education .5% Higher Education 10% Medical Natural Assistance Resources 12% Debt 1% Other Service/Pensions/Other K-12 8% 3% Office of Superintendent of Public Instruction 5
    • 6. Protected Sectors Drives Large Reductions in Others Deficit as % of Budget Deficit as % of Entire Available for If Deficit Level is: NGF* Budget Reduction $6.1 Billion 17% 39% $8.5 Billion 23% 55% • Fortunately, policymakers have some options that mitigate the need for pure percentage reductions at this level ▫ Some resource changes as proposed by Governor ▫ Pension method change ▫ Federal funding *Near General Fund-State Office of Superintendent of Public Instruction 6
    • 7. The Governor’s budget solves slightly under 2/3rd of the budget problem by reductions and not funding salary increases…with the remaining solution coming from various resources changes Source: Senate Ways and Means Committee Staff Office of Superintendent of Public Instruction 7
    • 8. The reductions in the Governor’s proposed 2009-11 budget are spread across state government, but some of the largest reductions occur in human services, K-12, and higher education * This reflects estimated net reductions accounting for any policy level increases included in the Governor’s proposed 2009-11 budget. There was also reductions made in her proposed 2009 supplemental budget for the current biennium. Source: Senate Ways and Means Committee Staff Office of Superintendent of Public Instruction 8
    • 9. Schools are 41% of the Budget; Take 16% of the Governor’s Proposed Reduction * Reflects net near general fund policy change after accounting for reductions and increases, but excludes impacts of compensation-related adjustments and assumed federal funding increases. Source: Senate Ways and Means Committee Staff Office of Superintendent of Public Instruction 9
    • 10. Federal Stimulus Funding Over 2 Years • Governor’s proposed budget assumed $1.1 Billion • Still refining new estimate for Washington: Anticipated 2 Year Funding Based on Conference Negotiations $835.6 Fiscal Stabilization (K-20 Portion) $175.2 Title I $231.9 IDEA (Spec Ed) $8.6 Ed Technology $0.0 Line-Item School Construction $3,431.5 All Other $4,682.8 Total for Washington • Not all available to solve state budget deficit!!! Office of Superintendent of Public Instruction 10
    • 11. K-12 Context • COLA is 4.1% in 2009-10; • State cannot cut “basic 0% in 2010-11 education” ▫ New update in March ▫ $360 M cost included in • Non-basic items include deficit projection (biennial cost): ▫ Drives an additional $158 M ▫ K-4 enhancement ($388 M) in local funds needed ▫ 2 LID ($75 M) ▫ Levy equalization ($456 M) ▫ I-728 ($908 M) ▫ Gifted education ($20 M) ▫ Health Benefits inflation ($96 M if 7% inflation) Office of Superintendent of Public Instruction 11
    • 12. Governor Proposed K-12 Budget • No COLA for 2009-11 Biennium ▫ $360 M savings in K-12; $620 M savings in state government total • I-728 reduced 22% ▫ $198 M cut from $908 M program • Levy Equalization reduced 33% ▫ $147 M cut from $456 M program • $48 M in programmatic cuts (e.g., Reading Corps) • $40 M; eliminate Math/Science Professional Development Office of Superintendent of Public Instruction 12
    • 13. Possibilities: Caution!!! • Budget reductions by state are very probable ▫ LEA probably not as deep as proposed by Governor • Likely no, or low COLA funded by state ▫ Local funds value of $158 million or $80/student/year • Health care inflation funded • Health care purchase-shift debate • Pension contribution adjustment • More federal funds • Budget delay will make May notices difficult Office of Superintendent of Public Instruction 13