NCSLnet: State Budget Update--Appendix C--Other Actions

State Budget Update

Appendix C: Other State Actions

May 1996

Overview
Appendix A: State summaries of 1996 revenues and expenditures
Appendix B: State summaries of 1996 revenues and expenditures

Other Actions

Summaries of state actions in anticipation of federal budget actions (excluding Medicaid) and local governments' involvement in the process.

Alabama: Legislative committees heard testimony from agency heads who are monitoring congressional action during hearings on welfare and Medicaid reform, the two areas in which reduced federal grants may cause fiscal problems. The governor established a task force on welfare reform that includes local representation. In anticipation of welfare cuts, the state entered a compact with other Southern states to bid on Electronics Benefits Transfer (EBT) technology and set up EBT pilot programs in three counties.

Alaska: No actions have been taken in anticipation of federal budget changes.

Arizona: The legislature approved a bill that would have appropriated federal funds. The measure also sought to establish a study commission with substantial public input to explore how to implement any new federal block grants. However, the governor vetoed the bill on April 25.

Arkansas: No regular session in 1996.

California: Welfare reform has taken place to the extent that the state would have been allowed to reduce welfare grants below maintenance of effort levels. The federal government did not approve waivers that would have allowed the state to reduce benefit levels. Also tied up in Congress is an effort to drop all immigrants from the state's Supplemental Social Security program.

Colorado: No actions have been taken in anticipation of federal budget changes.

Connecticut: The state created a Federal Funds Advisory Council, composed of legislators and executive branch officials, to monitor and examine federal budget changes. So far, local government officials have not been involved in the process.

Delaware: No actions have been taken in anticipation of federal budget changes.

District of Columbia: No actions have been taken in anticipation of federal budget changes.

Florida: No actions have been taken in anticipation of federal budget changes

Georgia: No actions have been taken in anticipation of federal budget changes.

Hawaii: No response.

Idaho: No actions have been taken in anticipation of federal budget changes.

Illinois: No actions have been taken in anticipation of federal budget changes.

Indiana: Other than House Enrolled Act 1219 (see Medicaid), no formal steps have been taken to prepare for federal budget changes.

Iowa: No actions have been taken in anticipation of federal budget changes.

Kansas: Kansas lawmakers are taking a "wait and see" approach to federal changes.

Kentucky: The governor will call a special session in January to address any federal changes taking place between April and the end of 1996. This would allow the legislature to modify the FY 1997 and FY 1998 budgets if necessary. Kentucky is a biennial budget state.

Louisiana: No actions have been taken in anticipation of federal budget changes.

Maine: The legislature put an additional $17.5 million into the rainy day fund.

Maryland: State officials eliminated approximately $50 million (1.5 percent) of federal funds from various program budgets for FY 1997 because the state does not expect to receive the funds. Welfare reform that places more emphasis on workfare passed for FY 1997. The state has kept local governments apprised of its actions.

Massachusetts: No formal actions have been taken in anticipation of federal budget changes.

Michigan: In addition to welfare reform (see Medicaid discussion), the state has authorized $70 million in state tax cuts (largely capital gains tax reductions) that are contingent on federal tax cuts. Because federal inaction may leave the state with a sizable budget gap, local officials have been notified that state aid may be reduced to deal with a budget shortfall. In fact, most state programs remain vulnerable to possible reductions.

Minnesota: There have been hearings but not much action. The state did increase reserves by $50 million to deal with possible aid reductions.

Mississippi: Mississippi has not taken any official action in anticipation of federal policy changes. Representatives from the National League of Cities will meet with the governor to discuss devolution's impact on states and cities.

Missouri: Some appropriations have been combined into large pools to ensure that the state budget does not include structural impediments limiting Missouri's ability to respond to federal fiscal policy changes. A supplemental appropriation "set-aside" has been increased by $20 million for FY 1997. The state rainy day fund will be increased to 2.5 percent of net general fund collections (about $115 million). Long-term debt and other state obligations are being paid off early leading to long-term savings in excess of $60 million.

Montana: No regular session in 1996. However, the Finance Committee continues to monitor federal activity, but no other actions have been taken in anticipation of federal budget changes.

Nebraska: No specific actions have been taken. Lawmakers are contemplating changes to the budget process to capture more information for the next budget cycle.

Nevada: No regular session in 1996. No actions have been taken in anticipation of federal budget changes.

New Hampshire: L95, Ch. 310 made changes to the welfare system (310:62 changed eligibility requirements) and cut $32 million from the general fund for health and human services in FY 1996 and FY 1997. Ch. 310 implemented the changes to generate savings not necessarily associated with anticipated federal changes.

New Jersey: There has been no legislative action in response to possible federal budget changes, although the administration has proposed major welfare reform that would require federal waivers.

New Mexico: The legislature took proper action to appropriate federal funds, but the governor vetoed all federal funds appropriations.

New York: The legislature is debating the governor's proposal to trim $2 billion from Medicaid and other welfare programs. The savings are contingent on federal budget changes to the programs.

North Carolina: No actions have been taken in anticipation of federal budget changes.

North Dakota: No regular session in 1996. However, legislation passed in the 1995 session outlines agency authority to cut programs or change priorities in the event of termination or recombination of federal funds. To date, there have been no changes, although the state's welfare system is being reviewed, as is long-term care. The interim committees' reports are due in late fall.

Ohio: No actions have been taken in anticipation of federal budget changes.

Oklahoma: Oklahoma has not taken any official action regarding federal policy changes. The legislature has conducted discussions in committees most likely to be affected (Health and Human Services), but no specific actions have taken place. Regarding local governments, a National League of Cities representative serves on the State Department of Human Resources Block Grant Advisory Committee.

Oregon: No regular session in 1996.

Pennsylvania: No actions have been taken in anticipation of federal budget changes.

Rhode Island: Prompted by talk of federal reform, Rhode Island is in the process of overhauling the state welfare system. Two proposals have been offered; one by the legislature and one from the governor's office. Neither proposal solicited input from local government officials.

South Carolina: Welfare reform measures were already in progress from previous years as the state has attempted to secure waivers for the changes.

South Dakota: No actions have been taken in anticipation of federal budget changes.

Tennessee: No actions have been taken in anticipation of federal budget changes.

Texas: No regular session in 1996.

Utah: No actions have been taken directly in anticipation of federal budget changes. The state has created the State-Local Government Study Commission, however, to begin meeting during the 1996 interim. The commission will look beyond federal funds issues to a broader spectrum of state-local issues.

Vermont: Vermont revised its revenue forecasting process to develop official estimates for federal and other nongeneral funds. A process has been put in place to reduce appropriated expenditures if federal or other revenues fall short of projections. The legislature also strengthened controls over the receipt of federal funds.

Virgin Islands: No actions have been taken in anticipation of federal budget changes.

Virginia: Other than the creation of a study panel on block grants, no actions have been taken in anticipation of federal budget changes.

Washington: No actions have been taken in anticipation of federal budget changes.

West Virginia: The state adopted a welfare reform package that included increased child support enforcement and a West Virginia "Works" program.

Wisconsin: No changes.

Wyoming: No actions have been taken in anticipation of federal budget changes.

Posted May 1996, reviewed December 2003.
Email statebudget-info@ncsl.org for more information.
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