The Idaho Senate Monday approved a plan to balance the current and next state budgets by transferring close to $140 million out of several state reserve funds.  Emptying those reserves is a key part in balancing the budget without raising taxes, and could provide a safety net in case tax revenues continue to be below expectations.

Sen. Dean Cameron, R-Rupert, said during debate on the plan that he’s grateful that previous lawmakers established reserve funds that can be drawn down now.  Cameron chairs the Joint Finance-Appropriation Committee, which set the fund transfers along with the state budget.

Lawmakers would transfer $59.7 million to balance the current budget and $79.6 million to balance the next budget.  Most of that money comes from the state’s Economic Recovery Reserve Fund and the Budget Stabilization Fund.  However, if more money is needed before the end of the current budget on June 30, lawmakers would allow the governor to spend reserves set aside for the next fiscal year.

“It’s a crucial contingency plan for the (governor),” Cameron said.  “We all know that by allowing us to pull that money forward, then that creates a hole for 2011.”  If that happens, Cameron said the governor’s options are further holdbacks and reductions or calling a special session that would bring lawmakers back to the Capitol.  Lawmakers would also give the governor the power to spend $27 million in the Permanent Building Fund, which is already targeted to go to certain repairs in the next budget year.

The plan now heads to the House for approval.  JFAC has set a $2.28 billion budget for the current fiscal year and $2.29 billion for the next fiscal year.  Read the text of the legislation outlining the fund transfers here.