1. Maryland’s Budget Process & FY 2016 Education Budget Outlook

2. Presentation Overview State Budget Process FY 2016 Budget Outlook MABE’s Budget Priorities

3. The annual State Budget is prepared by the Governor and submitted to the General Assembly at the beginning of session. A balanced budget is required. Maryland’s Constitution prohibits the General Assembly from increasing appropriations for the Executive Branch. The legislature’s role is limited to reducing or eliminating budget items. The General Assembly may not reduce or eliminate education funding mandated by law. Operating Budget Process

4. The Budget is an omnibus bill including all agencies, courts, and the legislature. The House Appropriations and Senate Budget & Taxation committees review the budget simultaneously. One house reports its version to the floor, alternating each year. A conference committee is always required to resolve differences. The Budget must pass one week before session ends. The Budget cannot be vetoed.

5. The Budget Reconciliation and Financing Act (BRFA) This is the bill that includes any changes in the law that are needed to achieve the Governor’s balanced budget. The BRFA is also the vehicle for any other amendments offered during session to reduce the state’s funding obligations in future years. State Funding: The BRFA

6. Operating Budget Process State Funding The Spending Affordability Committee studies and reviews the status and projections of State revenues and expenditures and the economy. The Committee's purpose is to limit the rate of growth of State spending to a level that does not exceed the rate of growth of the State's economy. Annually, the Committee recommends to the Governor and Legislative Policy Committee the fiscal goals of the State government budget to be considered at the next General Assembly session.

7. Operating Budget Process State Funding Board of Revenue Estimates (BRE) includes the Comptroller, State Treasurer, and Budget Secretary. The BRE presents its report in December, containing a revised estimate for the current fiscal year and the budget estimates for the next succeeding year based upon current laws and administrative practices. Updated estimates have been made in March in recent years, around the time when supplemental budgets are submitted.

8. Operating Budget Process Beginning in September after receipt of state agency budget requests, the Department of Budget and Management (DBM) initiates its budget review activity that culminates in the production of the State budget by the beginning of January. DBM analysts review requests and then make recommendations to the Governor as to the amount that should be appropriated to each agency. Completed summary allowance sheets are assembled in budget code sequence and printed as the multi-volume State Budget Books, the principal supporting documents of the budget bill.

9. The Department of Legislative Services (DLS) is responsible for the oversight of the executive budget. Legislative analysts begin the budget analysis process in the fall by meeting with the agencies to review budget requirements, including collecting workload measures, caseload statistics, and historical rates of expenditures to evaluate the need for and effectiveness of agency programs. Operating Budget Process

10.  Legislative Budget Hearings  Committee/Subcommittee Decisions  Budget Reductions  Budget Bill Language  Committee Narrative Operating Budget Process

11. Capital Budget Process The Capital Budget is submitted by the Governor to the General Assembly by the 20th day of session. Capital Debt Affordability Committee Role. The Capital Budget may not be finally acted upon until the operating budget has passed. Unlike the Operating Budget, the House and Senate usually deliberate on separate Capital Budget bills. The General Assembly can add to the Capital Budget. The Governor may veto the Capital Budget.

12. Article VIII, Section 1, of the Maryland Constitution mandates that the General Assembly “shall by Law establish throughout the State a thorough and efficient System of Free Public Schools; and shall provide by taxation, or otherwise, for their maintenance.” Section 3 further provides that “The School Fund of the State shall be kept inviolate, and appropriated only to the purposes of Education.” Maryland’s Constitution

13. General Fund Revenue & Ongoing Spending FY 2016 Budget Outlook

14. Status of the General Fund for FY 2015 FY 2016 Budget Outlook

15. Status of the General Fund for FY 2016 FY 2016 Budget Outlook

16. State Aid to Local Governments FY 2016 Budget Outlook

17. State Aid to Local Governments FY 2016 Budget Outlook

18. State Aid for Public Schools: FY 2014-2016 FY 2016 Fiscal Outlook SAC Briefing on November 12, 2014

19. FY 2016 Fiscal Outlook GCEI Funding Allocations for FY 2015

20. The Education Trust Fund FY 2016 Budget Outlook

21. School Construction’s Share of the Pie FY 2016 Capital Budget Outlook

22. Growth in Debt Service FY 2016 Capital Budget Outlook

23. Support for full State funding for Maryland’s outstanding public schools – MABE urges the Governor and General Assembly to support increased funding of public education in the FY 2016 State Budget. Local boards of education are committed to preparing all students to be globally competitive in college and careers. Increased state investments in public education are essential in these times of rapid change, rising expectations, and increased costs. Operating Budget MABE’s Budget Priorities

24. Support for robust State funding for school construction and renovation projects - MABE places a high priority on providing students high quality, healthy, and safe learning environments. Therefore, we greatly appreciate the State’s consistent investment in school construction and renovation projects. The FY 2016 school construction budget should provide at least $350 million to ensure that all Maryland schools are better learning environments to prepare our students to be college and career ready. Capital Budget MABE’s Budget Priorities