On a 40-27 tally Friday morning, the Idaho House of Representatives cleared a measure backers say will help the state fill reserve accounts, as well as focus on matching revenues to expenditures.
The legislation, sponsored by Rep. Dennis Lake, R-Blackfoot, heads to the Senate for consideration.
In the budget process, any excess revenues from one year are automatically carried over into the next year, a process Lake wants to end. His bill, instead, would require a year-end deposit of extra money into the state’s rainy day fund.
That, Lake told colleagues, will bolster reserve accounts, but would also compel lawmakers to find ways to make yearly expenses and revenue align in budget proceedings. “It forces us to align current revenues and current expenditures,” Lake explained.
The 2013 budget counts on some of that carryover from fiscal year 2012. Forecasts project more than $120 million in extra revenue this year, which will help fund some programs and initiatives next year.
Lake’s bill would have some effect on the 2013 budget. It would allow up to $100 million to be carried into 2013, but anything above that would be allocated to the reserve fund. When budgets were written earlier this year, lawmakers planned on having $103 million extra in 2012, so Lake’s bill would likely not drastically affect spending.
Budget committee co-chair Maxine Bell, R-Jerome, debated against the bill, arguing that it would tie the hands of her panel. “The flexibility is gone now,” Bell said.
Lake’s bill, however, wouldn’t completely deny access to the surplus funds. It would require the budget committee to vote to access the funds and withdraw them from savings accounts, but Bell also objected to that. “It should be a savings account, not a checking account,” she said of the reserve fund. “The process here is troublesome.”
The legislation would also remove the cap of how much money could be stored in reserves, previously limited to 5 percent of a year’s total tax revenues.
Lake has been supportive of filling reserves this year. He opposed a $35 million tax cut passed by the House earlier this year because he felt filling savings accounts holds a higher priority. He noted that the hundreds of millions the state held prior to the recession helped Idaho make it through tough budget years.
