[June 01, 2020] | We are going back in to the 2020 session on June 11th as it is planned right now. When we stopped way back in March, we had just completed Cross Over Day, and all the bills that the House passed were now in the Senate, and the Senate bills were in the House's hands.
The most important bill we had worked on was the budget, and the House-passed version is now in the hands of the Senate. It is very important to note the House version has no Covid-19 effects in it, because they had not happened yet. Governor Kemp had lowered the income estimate in his original budget and made some agencies cut their budgets, 4% in the 2019 budget and 6% in 2020 budget. Some agencies were exempt from the cut, like K -12 education and Higher education.
The economic fallout of the Covid-19 is wide reaching and affecting us in our homes, businesses, and at the State level. It looks like this will cause a 11.8 to 15% shortfall in revenue for the State of Georgia for the remainder of 2020 and 2021. What this means is a shortfall of 3 to 3.8 billion dollars.
Fortunately, during the past 8 years we have been saving for a rainy day in case this or some other event might happen to upset Georgia. Most of us call it the rainy-day fund; the fancy name is Reserve Shortfall Reserve (RSR). We will use the rainy-day fund to cover the losses for the 2020 fiscal year budget. The 2021 budget is another story; what the governor has required is that every state agency submit a budget reduction of 14%. This 14% will generate approximately $3.7 billion to get close to balancing a budget for the 2021 fiscal year. It?s just like your home or your business; you have to live within your means.
If you?re wondering, K-12 education and higher education cover about 55% of the budget. Health related budget programs cover about 20%. The rest of everything we do is in the remaining 25%.
The Senate is currently reviewing the budget we sent them after Cross Over Day. They are also reviewing agency plans for the 14% cut that was recently required by Governor Kemp. House members are also meeting with Senate members so that everyone can understand what agencies are attempting to do to meet this 14% cut. There are a lot of questions for the agency department heads in these meetings. They are public and online, so that if you?re really interested, you can watch. Contact me at my information below if you want me to help you find it. When you watch statewide news, you will see a lot of reporting about not funding this or cutting the budget to that; don?t be alarmed as there is still a lot of discussion that will take place before a final budget is agreed on later this month.
There will be some federal funds that may help a little, and I?m betting on the economy improving significantly when our confidence increases, and people are willing to get out more.
As the session gets started again, please don?t hesitate to contact us with any questions you may have on the budget or any of the bills you may be interested in. My Capitol contact is 404-656-7153, and my home is 770-893-2039; email is Rick.Jasperse@house.ga.gov.