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On Friday, the
Economic and Revenue Forecast Council released its
official update of projected revenues. As anticipated,
revenues are slightly up, about $31.5 million, above the
November estimate. The official forecast, however, also
includes the fiscal impacts of a Supreme Court decision
(DOT foods), so revenues are technically down
approximately $120 million from November. Most
observers, though, are assuming the tax “loophole” that
caused the state to lose this court case will be fixed
this session, which means the reduced revenue will not
be ongoing and may allow the state to recover a portion
of the lost revenue.
Legislators who sit on the Economic and Revenue
Forecast Council explained that these forecast
projections are “well within the planning parameters”
that budget-writers are using, so the official forecast
should not have a major impact on the budget writing
process. The behind-the-scenes job of crafting a 2010
Supplemental Operating Budget continues. It is unclear
when we will see a legislative budget proposal; however,
the Senate Ways & Means Committee has scheduled a
meeting on Wednesday, Feb. 17, with the agenda “to be
announced.” It is anticipated that this hearing
will be used to take public comment on a Senate budget
proposal which will probably be released that same day.
What will be in this budget proposal is still anybody’s
guess, but the rumors indicate that it may very well be
an ugly plan, with major impacts across state government
— including K-12 education. It is likely Initiative 728
(Student Achievement) and Initiative 732 (educator
COLAs) will remain on the chopping block, along with the
K-4 Class Size Enhancement and probably at least a
portion of the funding for All-Day Kindergarten. There
is no solid word, yet, about Local Effort Assistance
(LEA or levy equalization) funding; however, pressure to
maintain, or even perhaps, increase LEA continues to
escalate.
In further budget news, another major revenue
proposal has been introduced. As we have reported
before,
HB 3176 was introduced last week to close a number
of tax loopholes and to eliminate a series of tax
exemptions. That bill is scheduled to be heard in the
House Finance Committee tomorrow morning, along with the
Senate’s bill
(SB 6130) to temporarily suspend the hurdles to tax
increases contained in Initiative 960. Yesterday,
HB 3183 was introduced to temporarily increase the
sales tax by one cent. Eighty-eight percent of the
additional revenues would be deposited in the state’s
general fund, 17 percent would to into a transportation
construction fund intended to pay for job-generating
projects, and the remaining 3 percent would go towards
public transportation. The tax “surcharge” would be
phased out as unemployment declines and eventually be
eliminated once employment falls below five percent for
five straight months. Other tax and/or revenue packages
continue to be crafted, including an expected plan from
the governor. Reportedly, she will unveil her tax
package next week, as early as Tuesday, Feb. 16.
Legislators in the House and Senate continue to spend
most of their time in floor sessions and/or their
political caucuses as they work through lengthy floor
calendars. While there are still a number of
education-related bills in each house, there has been
little action on K-12 issues since the Senate’s adoption
of
SB 6696 (Race To The Top) and
SB 6760 (education funding formulas)
yesterday. Both the House and Senate are expected to
be in session tomorrow, potentially on Sunday, and
Monday’s floor sessions are expected to go well into the
night as legislators try to move bills before the house
of origin cut-off which comes at 5:00 pm on Tuesday,
Feb. 16.
An important scheduling note: Saturday, Feb. 20, is
being set aside for legislator’s town hall meetings. Not
all legislators will hold town hall meetings and not all
meetings will be held on Feb. 20; however, most
legislators will be in their home districts meeting with
constituents on this day. This is a great opportunity
for you to continue to build relationships with your
legislators and express your opinion on education issues
— especially if there is a legislative budget proposal
on the table next week. We’ll post information in our
Daily Update as soon as we have a list of meetings. You
can also contact your local legislators and ask them
when (or if) they’ll be holding a town hall.
Finally, congratulations to the many school districts
which successfully passed their M&O levies on Feb. 9.
Results are still preliminary and a few districts still
have mail-in ballots yet to be counted; however, at this
point, it appears that M&O levies in 162 (of 164)
districts were approved by their voters. This accounts
for more than $4.6 billion in local funding — just more
evidence of the voters’ strong support for public
education.
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