Last week’s budget hearings continued to produce frustrations with more predictions of revenue shortfalls. Gov. Sonny Perdue introduced both the FY 2010 Amended Budget and the FY 2011 General Budget on Tuesday.
He was followed by the individual commissioners with their department budgets testifying over the next two days. Gov. Perdue’s recommended Amended 2010 budget totals $17.4 billion, a $1.2 billion reduction from the original 2010 Budget, and the 2011 Budget stands at $18.2 billion.
While there are spending cuts throughout both budgets, the governor is recommending additional funding into the state’s mental health system to stabilize staffing levels in state hospitals and improve care for patients. Twenty million dollars is called for in the Amended 2010 Budget and an additional $50 million in 2011.
“We cannot retreat from our duty to protect those who cannot protect themselves,” Gov. Perdue said during his State of the State address.
“I am convinced that Georgia can, Georgia must, and Georgia will adequately care for citizens in our state’s mental health program, even though this has been a daunting challenge that precedes my time as governor.”
The Amended 2010 Budget also includes $27 million to provide disaster assistance funding for storm damage and floods in South Georgia this spring and for September flooding in the Metro Atlanta area.
The 2011 Budget includes just over $900 million in bond projects, including $168 million in construction, equipment, and school buses for Georgia’s K-12 schools.
There is also $121 million in projects at our state’s universities and another $44 million at technical schools. The total of $333 million in education signals a clear and continuing investment in Georgia’s future.
Unfortunately, the 2010 revenue shortfall is with us now, and measures must be taken to balance the budget through the remainder of the year. Although the governor has called for a $1.2 billion cut, I am not sure that will be enough.
Much of that $1.2 billion will come from the education portion of the budget, which makes up almost 50 percent.
The governor has recommended that teachers be furloughed an additional three non-teaching days this fiscal year, saving the state $300 million. The 2011 Budget does not recommend furlough days.
By way of comparison, most state employees are furloughed one day each month.
There are exceptions. Guards at prisons are not furloughed, but some of the administrative staff are furloughed more than one day each month.
Some members of the Georgia State Patrol are furloughed more than one day per month.
As he announced last week, the governor is recommending in the 2011 Budget $300 million in transportation projects in the bond package. In addition to that $300 million, the governor also recommended $68 million for the deepening of the Savannah River harbor. The joint federal-state project will deepen the shipping channel from 42 feet to 48 feet, allowing the world’s largest ships to call on the Savannah Port.
One of the most interesting, yet controversial proposals is the 1.6 percent tax on hospitals’ net revenue and on premiums collected by managed-care companies.
This tax revenue would be used to help plug a projected shortfall in Georgia’s Medicaid program. This tax would generate nearly $350 million in state revenue and allow a draw down of over a $1 billion in federal Medicaid funds.
That is because Medicaid is a joint state-federal responsibility, with the federal government responsible for about three-fourths of the cost.
“Without those fee hikes, the state would be forced to slash Medicaid reimbursements to all health-care providers by 16.5 percent,” Commissioner Rhonda Medows told members of the House and Senate appropriations committees.
“That is not a sustainable alternative for the providers,” Medows said. “They’re businessmen. They cannot do this.”
Because the tax would be on all revenue and premiums, only those hospitals with large numbers of Medicaid patients would be net winners. Atlanta’s Grady Memorial Hospital, for example, would reap $12 million from Perdue’s proposal. Hospitals with few or no Medicaid patients would lose money.
Lawmakers have little choice. We will probably have to go along. Medicaid is an entitlement, and we have to serve that population. These budgets will be studied closely, and I will continue to update you until they are sent to the Governor for signature.
To download a copy of both the Amended 2010 Budget and the 2011 Budget visit the Office of Planning and Budget’s home at www.opb.state.ga.us/ — and look on the top right for the link.
I will be at the Wagon Wheel Restaurant in Dahlonega for Saturday morning breakfast with constituents at 8 a.m. on Jan. 30 and Feb. 13.
I will be at Ryan’s Steakhouse (Hwys. 53 and 400) in Dawson County for Saturday morning breakfast on Feb. 6 at 8:30 a.m. As we get deeper into the session, I will let you know the rest of the Saturday breakfast schedule.
Rep. Amos Amerson can be reached at 401 State Capitol, Atlanta, GA 30334; (404) 657-8534; fax (404) 463-2044; e-mail email@example.com. Or, contact Gerald Lewy at (706) 344-7788.