Georgia state budget
From Sunshine Review
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Georgia has had to repeatedly revise and amend its state budgets for FY 2009 and FY 2010 as their revenue projections consistently declined. Gov. Sonny Perdue no sooner signed on May 13, rgi2009[1] the FY 2010 budget passed by the Georgia General Assembly than he had to order state agencies 16 days later to cut 25% for the month of June to squeak by to end FY 2009.[2]
The start of FY 2010 (July 1, 2009) did not bring relief from declining revenues and corresponding appropriation revisions as Gov. Perdue (agreed by legislative leaders to avoid a special session) on July 21, 2009 called on 128,000 teachers to take 3 unpaid furlough days while ordering 3% cuts in Medicaid and education budgets. Most other state agencies were ordered to take 5% cuts and their state personnel to also take 3 unpaid furlough days to cover the new $900 million deficit.[3]
The Georgia Department of Revenue released October 8, 2009 figures showing September 2009 state revenues were down 16% ($585 million) from September 2008, and FY 2010 year-to-date collections are down 14.2% ($1.37 billion) compared to FY 2009.[4] Georgia’s FY 2010 budget of $18.6 billion is $2.5 billion less than the original FY 2009 budget.[5] Georgia Budget and Policy Institute (GBPI) predicts the FY 2010 budget will be $1.2 billion short above and beyond the cuts made during its passage. GBPI estimates a deficit of $740 million for FY 2011, at which time the state will not have any reserve funds available and less federal stimulus money to cushion the impact.[6]
A total of $4 billion in measures have been taken to close Georgia's 2010 budget gap, $3.1 billion by the General Assembly during passage and $900 million by Gov. Perdue in July 2009. Actions on the FY 2010 budget break down into:[7]
- 38% Budget Cuts
- 34% Federal Stimulus
- 17% Reserves & Other Actions
- 11% Elimination of Homeowner Tax Relief Grant
[edit] Budget Background
The 2009 Georgia General Assembly Session's $3.1 billion budget adjustments for FY 2010 were:[8]
- Cutting $800 million from state agencies
- Eliminating the Homeowners Tax Relief Grant raising $428 million
- Using $1.4 billion from the federal State Fiscal Stabilization Fund and an increased federal Medicaid match (ARRA funds)
- Using $500 million in various reserve funds
During FY 2009, revenues declined 10.5 percent from FY 2008 levels. This resulted in a FY 2009 budget shortfall of approximately $650 million. Lawmakers closed the shortfall by using approximately $365 million of the remaining Revenue Shortfall Reserve funds, approximately $190 million in ARRA funds, and end-of-year budget savings.[9]
Top 2 sources of revenue are individual income taxes, $8.2 billion (anemic increase of .2% in FY 2010) and Sales & Use Taxes, $5.2 billion (-4.0% in FY 2010).[10]
Total State Funds[11]
| FY 2009 Amended Revenue | FY 2010 Estimated Revenue | Percentage Change |
| $18,629,356,585 | $18,569,866,489 | -0.3% |
FY 2010 Total State Funds Budget (Includes Lottery Funds and Tobacco Funds) Funding Area[12]
| Education | 58.1% |
| Health and Social Services | 10.0% |
| Criminal Justice | 9.1% |
| Medicaid and PeachCare | 8.9% |
| Debt Service | 6.1% |
| Transportation | 3.8% |
| All Other Government | 4.0% |
Georgia's fiscal year runs from July 1 to June 30. The Governor submits the budget to the Legislature in January for their annual session.[13]
[edit] Budget figures
The following table provides a history of Georgia's expenditures and gross domestic product (GDP).
| Fiscal Year | Expenditures (billions) | GDP (billions) |
|---|---|---|
| 2000 | $43.5 [14] | $290.9 [14] |
| 2001 | $48.6 [14] | $299.4 [14] |
| 2002 | $53.6 [14] | $306.7 [14] |
| 2003 | $56.0 [14] | $317.9 [14] |
| 2004 | $58.4 [14] | $338.5 [14] |
| 2005 | $58.9 [14] | $359.7 [14] |
| 2006 | $63.0 [14] | $376.4 [14] |
| 2007 | $72.6 [14] | $396.5 [14] |
| 2008 | $81.2 [14] | $409.6 [14] |
| 2009 | $90.7* [14] | $408.9* [14] |
- NOTE: The figures for FY 2009 won't be finalized until the end of the fiscal year.
See Georgia state budget (2008-2009) for more details.
[edit] Accounting Principles
The Georgia State Accounting Office was established on October 6, 2004 with an executive order signed by Governor Sonny Perdue. Governor Perdue signed House Bill 293, which codifies the realignment of the state's financial reporting and financial system responsibilities under a single State Accounting Officer (SAO). Greg Griffin was appointed Georgia's State Accounting Officer in August 2008. The State Accounting Office is responsible for the following duties:[15]
- Establish statewide accounting and reporting standards and practices.
- Operate and improve statewide financial and human capital management systems.
- Prepare the state's Comprehensive Annual Financial Report (CAFR); the annual audited financial statement for the entire state entity.
- Provide statewide financial information on interim basis.
- Train state accounting and payroll personnel in new polices, procedures and standards.
- Improve accountability, efficiencies and internal controls.
The Georgia Department of Audits is responsible for state finanical accountability. The State Auditor is Russell Hinton.[16]
The Institute for Truth in Accounting (IFTA) rates Georgia “Tardy” in filing the state’s Comprehensive Annual Financial Report (CAFR) – The annual report of state and local governmental entities. IFTA rated 22 states timely, 22 states tardy, and 6 states as worst. IFTA does not consider Georgia’s CAFRs, and those of the other states, to be accurate representations of the state’s financial condition because the Generally Accepted Accounting Principles (GAAP) basis does not include significant liabilities for the pension plans and for other post employment benefits, such as health care.[17] Georgia's CAFRs are published online by the Georgia Department of Audit.[18]
[edit] Accounting transparency checklist
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[edit] The good
- An independent auditor’s report is published on page 1 of the document.[19]
- It provides supplements to the budget workup, such as non-major Governmental funds, starting on page 124 of the document.
- The budget is posted using organized and consistent methods of financial reporting.
- Georgia law requires a balanced budget and prohibits a deficit at the end of the year to be carried over to the following year.[20]
- It includes all costs incurred by the government, including future liabilities, starting on page 89 of the document.
- The CAFR compares estimated and actual budgetary numbers, such as on page 106 of the document.
[edit] The bad
- The website has Comprehensive Annual Financial Reports (CAFR), but only those dating back to 2005.[19]
- The Georgia office was not precisely timely in submitting the budget.
- The CAFR is posted in PDF format, so it’s not searchable online.
Gov. Perdue has commented on Georgia's high credit rating stating, “We have maintained triple-a bond ratings, saving the state tens of millions of dollars, and funded our top priorities to ensure the basic responsibilities of state government are being met.”[21]
| Credit Rating | Fitch | Moody's | S&P |
| Georgia[22] | AAA | Aaa | AAA |
[edit] Economic Stimulus Package
Georgia is expected to receive $5.9 billion from the $787 billion dollar economic stimulus.[23] All told, the federal stimulus plan would create or save 106,000 jobs in Georgia, based on White House estimates.[24]
For more information on how the federal stimulus funds are being used in the state of Georgia, visit the state recovery website.
According to preliminary reports, Georgia is expected to receive:
- $1.7 billion infusion for Medicaid[23]
- $1.2 billion for education[23]
- $1 billion to build and repair highways and bridges[23]
[edit] Budget transparency
Georgia's official spending transparency database, mandated by the Transparency in Government Act of May 2008, was launched by January 2009. It is available here. On August 26, 2008, well in advance of that requirement, however, Karen Handel, Georgia's Secretary of State, launched the Transparency in Government Initiative. This website will be updated monthly to account for the agency's expenditures, and includes Handel's budget for 2009.
[edit] Legislation
- Georgia Senate Bill 300 (2008), Transparency in Government Act
[edit] Website evaluation
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Georgia.gov is the website for the state of Georgia.
- Main article: Evaluation of state websites
[edit] The good
- Site has a search function and is fairly easy to navigate.
- Annual financial audit available.[25]
- Elected officials listed with contact information under respective office.[26]
- Administrative officials listed under respective agencies.[27]
- Information on the state ethics commission is available.[28]
- State contracts are published.[29]
- Tax information is provided.[30]
[edit] The bad
- Budget in brief and budgetary compliance reports posted, but full budget does not appear to be available.[31] Other budget documents also available.[32]
- Does not provide information on lobbying.
- Georgia Open Records Act procedures are listed, but contact information/form for making request is not provided.[33]
[edit] Government tools
The following table is helpful in evaluating the level of transparency provided by a state spending and transparency database:
| State Database | Searchability | Grants | Contracts | Line Item Expenditures | Dept/Agency Budgets | Public Employee Salary |
|---|---|---|---|---|---|---|
| Open Georgia |  |  | | | | |
[edit] Limitations and Suggestions
Although "Open Georgia" does not yet list grants or contracts, the legislation which authorized its creation mandates that state grants and contracts be placed online by January 2010.
[edit] Economic Stimulus Transparency
- The American Recovery and Reinvestment Act of 2009 designated $787 billion to be spent throughout the U.S. Of that $787 billion stimulus package, it is estimated that 69%, or over $541 billion, will be administered by state governments.[34]
- It is estimated that Georgia will receive at least $4.5 billion in federal funding.[35]
- The economic recovery website for Georgia is available here.
[edit] Error in ARRP
On November 16 and 17, 2009, many errors were found in the $747 billion plan that showed the plan set aside money for districts that do not exist. According to Recovery.gov, the plan shows its funds will go to 884 Congressional Districts, though there are only 435.[36][37]
Millions of dollars in stimulus funds have been disbursed among 7 Congressional Districts in Georgia that do not exist, according to recovery.gov. [38]
[edit] Support for creation of the database
The National Taxpayers Union and the Council for Citizens Against Government Waste sent a letter to legislators in Georgia on April 16, 2007, urging them to support Georgia Senate Bill 300 (2008).[39] The Americans for Tax Reform also supported Georgia Senate Bill 300 (2008).[40]
[edit] Independent transparency sites
The Georgia Public Policy Foundation has launched a transparency website, the Georgia Report Card for Parents, that focuses on school spending. This site helps place the Foundation on the cutting edge of the transparency movement.
[edit] Public employee salary information
- The Georgia Department of Audits and Accounts has posted public employee salaries and travel expenses. It is broken down by organization type, then specific organization, then specific title or position.
- Open Georgia is a gateway for obtaining information about how the State of Georgia spends tax dollars, and includes payroll information.
[edit] See Also
Georgia taxpayer-funded lobbying
[edit] External links
- www.open.georgia.gov
- Georgia Public Policy Foundation
- Transparency in Government Initiative, official website
- Secretary of State, Georgia government
- News Release, Georgia Secretary of State's Office
- Governor's Office of Planning and Budget
- Georgia State Legislature
- Model transparency legislation from the American Legislative Exchange Council is available at this link.
[edit] Additional reading
- Gov. Perdue,"Governor Perdue Signs Amended FY09 Budget," March 13,2009
- Gov. Perdue,"FY 2010 budget," retrieved June 3,2009
[edit] References
- ↑ Gov. Perdue Press Release, “Governor Perdue Signs $18.6 Billion Fiscal Year 2010 Budget,” May 13, 2009
- ↑ The Atlanta Journal-Constitution, "State agencies to cut 25% in June," May 29, 2009
- ↑ Savannah Morning News, "Gov. Perdue calls for furloughs, more budget cuts," July 21, 2009
- ↑ Georgia Deptartment of Revenue, “Comparative Net Revenue Collections," October 8, 2009
- ↑ Gov. Perdue Press Release, “Governor Perdue Signs $18.6 Billion Fiscal Year 2010 Budget,” May 13, 2009
- ↑ Georgia Budget & Policy Institute, “Solving Georgia’s Fiscal Crisis Requires More Thoughtful Measures Than Cutting Public Structures,” September 2009
- ↑ Georgia Budget & Policy Institute, “Solving Georgia’s Fiscal Crisis Requires More Thoughtful Measures Than Cutting Public Structures,” September 2009
- ↑ Georgia Budget & Policy Institute, “Analysis of the FY 2010 Budget: Closing One Year’s Shortfall and Planning for Another,” June 2009 (Updated 7/13/2009)
- ↑ Georgia Budget & Policy Institute, “Analysis of the FY 2010 Budget: Closing One Year’s Shortfall and Planning for Another,” June 2009 (Updated 7/13/2009)
- ↑ Georgia Budget & Policy Institute, “Analysis of the FY 2010 Budget: Closing One Year’s Shortfall and Planning for Another,” June 2009 (Updated 7/13/2009)
- ↑ Georgia Budget & Policy Institute, “Analysis of the FY 2010 Budget: Closing One Year’s Shortfall and Planning for Another,” June 2009 (Updated 7/13/2009)
- ↑ Georgia Budget & Policy Institute, “Analysis of the FY 2010 Budget: Closing One Year’s Shortfall and Planning for Another,” June 2009 (Updated 7/13/2009)
- ↑ National Association of Budget Officers, "Budget Processes in the States," 2008
- ↑ 14.00 14.01 14.02 14.03 14.04 14.05 14.06 14.07 14.08 14.09 14.10 14.11 14.12 14.13 14.14 14.15 14.16 14.17 14.18 14.19 US Government Spending,"Georgia State and Local spending," retrieved June 3,2009
- ↑ Georgia State Accounting Office Web site, retrieved October 15, 2009
- ↑ The Georgia Department of Audits Web site, retrieved October 15, 2009
- ↑ Institute for Truth in Accounting, “The Truth About Balanced Budgets—A Fifty State Study,” Page 35
- ↑ The Georgia Department of Audits Web site, retrieved October 15, 2009
- ↑ 19.0 19.1 State financial reports
- ↑ Institute for Truth in Accounting, Georgia
- ↑ Gov. Perdue Press Release, “Governor Perdue Signs $18.6 Billion Fiscal Year 2010 Budget,” May 13, 2009
- ↑ California State Treasurer, “Comparison of Other States’ General Obligation Bond Ratings”
- ↑ 23.0 23.1 23.2 23.3 Associated Press,"Georgia Stimulus," February 15,2009
- ↑ American Recovery and Reinvestment Act,"Impact," retrieved June 3,2009
- ↑ CAFR
- ↑ Executive Branch
- ↑ Agencies
- ↑ Ethics Commission
- ↑ Statewide Contracts
- ↑ Dept. of Revenue
- ↑ Financial Reports
- ↑ Office of Planning & Budget
- ↑ Records Procedures
- ↑ National Taxpayers Union, "A Letter to the Nation's Governors: Ensure Transparency and Accountability by Posting Stimulus Expenditures Online," March 10, 2009
- ↑ Wall Street Journal, "Stimulus Spending by State," April 23,2009
- ↑ $6.4 Billion Stimulus goes to Phantom Districts, Watchdog.org, November 17, 2009
- ↑ Stimulus Creates Jobs in Non-Existent Congressional Districts, Watchdog.org, November 16, 2009
- ↑ Georgia, Watchdog.org, November 17, 2009
- ↑ National Taxpayers Union, "Taxpayers Support Creating Grant and Contract Database in Georgia," April 16, 2007.
- ↑ Americans for Tax Reform, Letter in Support of SB 300, March 17, 2008.
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