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Governor’s staff outlines hidden spending wish list

Governor’s staff outlines hidden spending wish list

Dustin Hurst
January 13, 2015
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January 13, 2015

Gov. Butch Otter’s top staffers took to the budget committee Tuesday to explain their boss’s agenda for 2015, including new spending on schools and a modest increase to Medicaid outlays.

Oh, and staffers outlined just exactly how the governor wants to spend the dollars his budget suggests he isn’t really spending.

The governor laid out his spending in Monday’s State of the State address, telling onlookers his budget keeps government’s growth behind economic advancement in fiscal year 2016, which kicks off July 1.

A closer look revealed some nifty accounting to get there. Otter’s economists predict 5.5 percent economic growth in 2016 and he touted his budget would only grow government at 5.2 percent.

The governor depended on fund transfers to hide his actual increase of 6.5 percent.

On the accounting sheet, fund transfers act just like spending: the money goes out and the overall budget number accounts for that. But lawmakers don’t set specific targets for those dollars, and instead put them into dedicated accounts.

Some transfers don’t count as new spending. This year, Otter wants $33 million for the state’s rainy day fund, a necessity he believes will prepare Idaho for another economic downturn.

Others are clearly new spending. In 2016, Otter wants $6.26 million, for example, for the permanent building fund, an account state government uses to build new facilities and maintain old ones.

Otter’s budget director Jani Revier outlined that expense in front of the Joint Finance-Appropriations Committee Tuesday.

“This will help address the backlog in alteration and repair,” Revier said, noting that the fund received millions more in maintenance and repair requests last year than it could handle.

Otter also seeks $10 million, split into two equal parts, for the Departments of Commerce and Labor. The governor said the money will help each agency expand businesses subsidies and worker training programs in Idaho, which Otter believes will expand the economy.

The biggest expense of the spending transfers is a whopping $20 million to cover an odd payroll quirk in fiscal year 2017. The calendar generates a 27th payroll every 11 years for entities that pay workers every two weeks, as opposed to twice monthly.

Revier repeated Otter’s assertion his government will grow slower than the economy to the budget-setters.

One critic thinks Otter and his team need to stop whitewashing a larger-than-advertised spending hike. “Fund transfers should not be used to hide spending,” said Bob Williams, president of State Budget Solutions, a good government nonprofit group.

Williams and his team advocate for clear and accurate accounting practices that give taxpayers an uncomplicated look at state finances. This is not that, Williams said. “It is a big gimmick that really masks the real increase in spending,” he explained.

Budget-writers will hold weeks of hearings from agency officials on spending requests before setting outlays for 2016. Signals suggest lawmakers will go big for education, and may increase cash for public schools as much as $100 million.

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