In his monthly letter to the state comptroller, Office of Policy and Management Secretary Ben Barnes painted a somewhat sunnier budgetary picture than he gave to the legislature’s Appropriations Committee four days earlier.
The state is currently spending $9.3 million less than it appropriated for the year. The number is down $12 million from a week ago when Barnes told the Appropriations Committee that the state was spending $2.7 million more than appropriated levels.
Deficiencies in state accounts have also decreased from last week when he projected a $33 million shortfall, most of which was the result of the increased Medicaid population. As of Nov. 18 the number amounted to $12 million, $7.6 million of which came from the Department of Social Services’ Medicaid account.
Barnes said the deficiencies are more than offset by a $65 million lapse in the Treasurer’s Debt Service account caused by lower than expected costs from bond sales. Another $24 million is expected to lapse in the Department of Children and Families, where caseloads have been lower than budgeted, he said. There are also a total of $4.3 million in lapses in other state accounts, he said.
OPM is projecting a $79.1 million General Fund balance at the end of the fiscal year, $3.5 million more than last month, Barnes said. That is $4.1 million more than the $75 million reserved for the transition to Generally Accepted Accounting Principals.
However Barnes cited some potential problem areas, including an upcoming evaluation of the State Employees Retirement Fund and the uncertain impact of the changes made to the health care policies of state employees. The uncertainty is caused by the fact that more state workers chose to sign up for Health Enhancement Program than were expected.
“…based on higher than anticipated enrollment in the Health Enhancement Program and the limited expenditure data available to this office, a significant shortfall is possible for these accounts; as more data becomes available a revised estimate can be made,” he wrote.
Revenues are expected to drop this month by $8.5 million due to tax breaks passed during the October special session on jobs, he said. Aside from that revenues are consistent with last month, he said.
Barnes said his projections do not yet include any money the state spent in the aftermath of the two major storms in August and October. Those expenditures are still being tallied, he said. The federal government has also yet to pass its budget and it’s unclear whether it will impact funding to state programs, he said.