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Still no state budget – what should localities do?

The state has still not passed a budget for 2014-15, with the start of the fiscal year looming about a month away on July 1.

It makes sense that the General Assembly and more particularly the Virginia House of Delegates should come to some resolution with Gov. Terry McAuliffe in that time frame.

But recent history indicates that may not be so, since they haven’t so far.

While the state Senate passed a budget, the House of Delegates refused to do so while the General Assembly was in session earlier this year.

Both sides appear to be entrenched in their positions over Medicaid expansion and have the issue tied up in the budget.

A slide presentation being passed along by a state official indicates that if no state appropriation act is in place July 1, the Commonwealth will be in uncharted territory.

Taxes and other revenues of the Commonwealth will continue to be deposited into the state Treasury, but no moneys can be paid out of the State Treasury except as authorized by an appropriations act signed by the Governor.

That means no appropriations can be made to localities.
Localities are likewise in uncharted territory.
About 40 percent of the King George County budget is comprised of state funding, adding up to $27.5 million of the $68,202,063 total county budget.

The largest share of state funding goes for the School Board (57 percent of the School Board’s budget).

Below are the rest of the amounts of state revenue for various departments, along with the percentages for each of those department budgets.
-  $1.7 million for Social Services/CSA (40% of budget)
-  $985,000 for Sheriff (28% of budget)
-  $276,000 for Commonwealth Attorney (50% of budget)
-  $215,000 for Clerk of Circuit Court (52% of budget)
-  $115,000 for Comm. of Revenue (30% of budget)
-  $92,000 for Library (18% of budget)
-  $89,000 for Treasurer (30% of budget)
-  $42,000 for Registrar (34% of budget)  
 
With no state budget, it continues to be unclear whether appropriations will be made to the School Board, Social Services, law enforcement and the other departments.

If appropriations are made, they can only be made up to the amount of local county funding that goes towards each budget.

Localities continue to operate under the assumption that a budget will be enacted and signed into law by the Governor prior to the July 1 deadline.

It has been hoped that an exercise to come up with a contingency plan could be avoided.

It would be a time-consuming exercise to work out details of local-only appropriations, and particularly of the rules that would be followed, particularly if it is not needed.  

But if a state budget is not passed, choices would have to be made at the county level.

That’s poser that leads to several avenues of speculation.

Would local-only appropriations be made for whatever length of time they would last and then bring schools, social services, law enforcement, etc., to a screeching halt?

Should rules be explored, decided upon and implemented to only pay “essential personnel” until state revenues start flowing?      

Who or what is “essential”?

Should employee groups be laid off?

Would only certain departments operate?

To answer just those few questions – and there are many more options – calculations would have to be made on how long the local-only revenue alone could keep each department going.

Answering any of the questions brings forward a slew of more questions.

Stay tuned.

Phyllis Cook

 

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