State budget still unsettled

The threat of at least a partial state government shutdown remains as several budgets are unresolved with just a week before the new Oct. 31 deadline. The Legislature bought extra time back on Oct. 1 to get a long-term budget agreement but continued posturing between the governor and leadership in the Senate has kept the budget logjam in place. The general government budget, which includes appropriations for revenue sharing payments, remains in limbo.

In what appears to be a high stakes game of budget chicken, the Senate was holding up the presentation of six budget bills to the governor, through a procedural move, because the governor was making threats of vetoing portions of the bills due to the severity of cuts. After holding the bills for almost three weeks, Senate Majority Leader Mike Bishop (R-Rochester) finally released the bills on Tuesday, Oct. 20 for the governor's signature. The governor also recently acted on the K-12 budget by vetoing $51.5 million of it, stating she had no choice because the Senate sent her a budget that was $60 million short in funding. The theory is that with a week before the new budget deadline, the Legislature still has time to approve budgets with higher funding levels.

One of the six unsettled budget bills is the general government budget that contains revenue sharing and payments-in-lieu-of-taxes (PILT) for local governments. As approved, this budget contains a 19 percent cut in statutory revenue sharing and an 11 percent cut to the combined total of all statutory and constitutional revenue sharing amounts. It also contains a projected 5 percent cut in constitutional revenue sharing. Constitutional amounts are based solely on the amount of sales tax revenue collected by the state. Cuts in PILT would be 12 percent. The governor has made statements that she believes cuts to revenue sharing (police and fire protection) are too severe. If the governor were to line-item veto revenue sharing, it would eliminate all statutory revenue sharing funding for townships, cities, villages and counties. The theory, again, would be to force the Legislature to go back to work on a higher funding amount. Higher funding amounts would also require approval of new state revenues.