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Georgia General Assembly Begins 2012 Session Today; Deal Including $46.8 Mil More for Port Deepening

Category: Local Govts & Politics

By Lou Phelps, SBJ Staff Report

 

Jan 9, 2012 – The Georgia General Assembly begins its 2012 session today.  And, one of the first items on everyone’s agenda will Governor Nathan Deals budget proposal for Fiscal 2013.

The Governor will deliver his budget message Tuesday morning at the Georgia Chamber of Commerce’s Eggs & Issues event. 

Deal will reportedly propose merging or eliminating some state agencies to save money, acknowledging that his plan will probably include some layoffs.  Proposed for elimination are the State Personnel Administration which manages all human resources functions for State employees. That department’s duties would move to the Dept. of Administrative Services.

He is also going to recommend shutting down the State’s Aviation Dept. and selling off State-owned aircraft.

Also, the state’s Safety Inspection Program would move from the Dept. of Labor to the Dept. of Agriculture.

According to Rep. Ron Stephens of Savannah who is chairman of the House Economic Development & Tourism Committee, and a member of the House Appropriations Committee, the Governor’s budget will include the $46.8 million in additional commitments being sought by the Georgia Ports Authority for the Savannah River deepening project.

While the Army Corps of Engineer’s final report is not due until late June 2012, with final approval by the Dept. of Defense not expected until the 3rd Qtr, if the deepening is approved, construction would begin soon after approval, and certainly within Fiscal 2013 that runs until June 20, 2013.  Therefore, increased funding from Georgia is needed now.

Stephens says the ‘inside word’ is that the deepening is going to be approved, and he therefore supports the State adding an additional $46.8 million to its previous commitment of $136 million for its share of the total project.  The Federal Government will fund the balance.  

The increase is apparently due to anticipated increases in the cost of the total project, according to both Stephens and State Senator Buddy Carter who sits on the Senate Appropriations Committee, though GPA has not officially outlined cost increases. 

As to the rest of the Governor’s budget, not a lot of information has leaked out yet. Deal asked all agencies to cut their current Fiscal 2012 budget by 2 percent, and present a Fiscal 2012-2013 budget request that has an additional 2 percent cut except for Medicaid, Quality Basic Education, Equalization and State Schools budgets which were exempted from both cuts.

 

Understanding the Budget Process

The Georgia Constitution requires that the State Government operate under a balanced budget which means that the state cannot incur a deficit and cannot borrow money for operating funds - no expenses can be incurred for which funds are not available.

And, no state funds can be spent unless they re authorized in an appropriation bill approved by the General Assembly and signed by the Governor. Generally, the only borrowing permitted is for the funding of major capital outlay projects through the issuance of bonds, and the annual debt service payments cannot exceed 10 percent of the prior year's treasury receipts.

There are four phases in the budget process:

First, departments submit formal budget requests. Second, the Governor makes spending recommendations to the General Assembly through a Budget Report. Third, the General Assembly passes an appropriation bill. And, fourth, the appropriated funds are spent under the direct control of the Governor's Office of Planning and Budget (OPB).

To finalize a budget, three revenue steps occur: projection of the amount of tax receipts, fees and other revenues that will be collected by the state's general treasury during a twelve-month fiscal year period; determine if there is any surplus from funds that were appropriated in prior years, but not spent – available for re-appropriation. And third, the projection of other funds from sources such as Lottery income, the Indigent Care Trust Fund, the Tobacco Fund and the Midyear Adjustment Reserve.

The first phase of the budget process - the official requests by each department or state agency to the Governor – has been completed. Those requests had to be submitted to the Governor by September 1.

A series of meetings with the Governor were then held in October and November, during which each OPB budget analyst briefed the Governor on agency requests and made preliminary recommendations based on his or her analysis of the requests. The Governor then formulates his tentative recommendations.

Revenue estimates were then finalized in early December, and final budget recommendations were made. Late in December, the Governor's Budget Report is printed, detailing his recommendations to the General Assembly. But it has not yet been released to the public.

State law requires that the publication be presented to the General Assembly within five days after it convenes in January. Traditionally, the Governor announces his recommendations in a meeting with the joint committees and also delivers a Budget Message to a joint session of the General Assembly on Thursday of the first week of the session.

How the General Assembly Processes the Governor’s Budget Request

The joint hearing for the General Appropriations Budget Requests are held the week following the first week of the session, with both Stephens and Carter heavily involved. Savannah is well-represented in the budgeting process.

After the Appropriations Hearings, the budget process in the General Assembly begins with the Subcommittees of the House Appropriations Committee. The Subcommittees make recommendations to the Budget Subcommittee, which is made up of the leadership of the House. The House Budget Subcommittee considers all of the subcommittee recommendations and proposes a recommendation to the House Appropriations Committee. The House Appropriations Committee then passes its recommendation to the full House.

The Appropriation Bill is then transmitted to the Senate. The Senate follows the same committee process as the House. Once the Senate has adopted their substitute to the House Bill, they send the bill back to the House for acceptance or rejection.

If the House rejects the Senate proposal, a conference committee is appointed. The Speaker of the House appoints three members from the House of Representatives and the Lieutenant Governor appoints three members from the Senate to serve as conferees. The Conference Committee, through negotiation and compromise, agree on a proposed appropriation to be voted on by both Houses, in theory. The House and the Senate must vote Yea or Nay on the Conference Committee Report. No amendments are allowed.

After an Appropriation Bill is passed, it is sent to the Governor for his signature. The Governor has line item veto power, however he must sign the bill within forty days after adjournment or the bill as drafted by the House and Senate becomes law.

One of the first steps, of course, is projecting revenues, which includes projecting out the current fiscal year will end. To date, the Governor’s office has projected the following. The Fiscal 2013 projections will be released this week, as part of Deal’s budget proposal.

TOTAL REVENUES AVAILABLE:

July 1 2007- June 30, 2008 $19,799,134,318

July 1 2008- June 30, 2009 $17,832,365,614

July 1 2009- June 30, 2010 $16,251,244,424

July 1 2010- June 30, 2011 $18,052,709,014

July 1 2011- June 30, 2012 $18,162,513,870 ( Projected)

Published by SavannahBusinessJournal.com. Copyright 2012. All Rights Reserved.

 

 

 

Published by SavannahBusinessJournal.com. Copyright 2012. All Rights Reserved.

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