MACo Expresses Concern With Budget Actions and Future Effects

MACo Legislative Director  Andrea Mansfield testified before the House Appropriations Committee and the Senate Budget and Taxation Committee this week on HB 72 / SB 57, the  Budget Reconciliation and Financing Act of 2015 (BRFA). The BRFA reconciles various provisions incorporated into the Administration’s FY 2016 fiscal plan, bringing the proposed budget into balance for the year.  County governments have suffered through many state budget cutbacks over the years and MACo is concerned with components of this year’s BRFA and their future effects on local governments.

MACo’s written testimony discusses the following BRFA actions:  education funding reductions, the flat funding of programs or the rolling back of formula increases for many local aid programs, the repayment of  Program Open Space, funding reductions to video lottery terminal impact grants,  and a provision that would override spending formulas.

From the written testimony (HB 72/SB 57):

Counties provide almost half of all local school system revenues, and education spending accounts for half of many county budgets. Reductions in education funding – including actual cutbacks to 10 county boards when compared to the prior fiscal year – will place enormous increased pressure on the counties to provide dollars for public schools, even on top of the still-increasing burden of teacher pension costs shifted to county governments.

Other reductions will also place pressure on county governments to provide funding for needed services.

One year after formula funding was restored and additional funding provided for some programs, the Governor’s proposed FY 2016 proposed budget seeks to roll back virtually all of these increases, sending distributions in most areas of direct aid to county governments back toward the deepest levels of the great recession. Given sluggish revenue growth, federal budget uncertainties, and potential changes in out-of-state income taxation, counties will have substantial difficulties absorbing these reductions.

In closing, Ms. Mansfield stated that “MACo hopes that state leaders recognize that the burdens on county budgets are substantial, and these challenges would only by worsened by added cost shifts or disproportionate budget cutbacks on county programs.”

For more on MACo’s 2015 legislation, visit the Legislative Database.

DLS BRFA Overview Document