1. Senator Dean Cameron Chair Senate Finance Committee Co-Chair JFAC

2. Guiding Principles - Constitution EXECUTIVE DEPARTMENT Article IV Section 8 – Governor May Require Reports - Messages to the Legislature 1) State of the State 2) Report of all Expenditures 3) Estimates of amount of money required by taxation Section 17 – Accounts & Reports of Officers Agencies report all revenues and expenditures to Governor before the session, who then transmits to the Legislature FINANCE AND REVENUE Article VII Section 11- Finance & Revenue Legislature must balance budget Section 13 – Money How Drawn from the Treasury All money drawn from the state treasury subject to appropriation 2

3. Guiding Principles - Statutory  Chapter 35, Title 67 - State Budget  Chapter 36, Title 67 - Standard Appropriations Act of 1945  Chapter 68, Title 67 - Economic Estimates  Sections IC 57-814 – 57-814A - Budget Stabilization Fund  Sections IC 67-432 thru 67-440 – Joint Finance- Appropriations Committee (JFAC)  Section IC 67-703 – Budget & Policy Analysis – Function of Legislative Services Office 3

4. Idaho State Budget Process Budget Development Manual May State Agencies Develop Budgets June – Aug. Budget Setting Process by JFAC Appropriation Bills to the Floor Feb.-Mar. If Vetoed Signature or Veto Becomes Law Analysis & Development of Legislative Budget Book Analysis & Development of Legislative Budget Book Analysis & Development of Executive Budget Recommendation Analysis & Development of Executive Budget Recommendation Sept.-Dec. House Senate September 1 Agencies Submit Budgets Legislature Governor’s Office Jan.-Feb. Budget Hearing Process for JFAC Budget Hearing Process for JFAC Presentation of Executive Budget to Legislature Presentation of Executive Budget to Legislature To Governor For Approval To Governor For Approval

5. Idaho Joint Finance- Appropriations Committee  10 Senators & 10 Representatives  Meets 8 am - Monday thru Friday  5 Weeks of Budget Hearings  3 Weeks of Budget Setting  Idaho Legislature looks at both the agency request and the Governor’s recommendation, and key measures and fiscal information.  JFAC has “early morning meetings” during budget setting at 7am to discuss the upcoming morning’s work. JFAC members often share prepared motions with other committee members and often work out differences.

6. FY 2015 Gen Fund Revenue $2,990.4 million 6

7. FY 2015 Gen Fund Appropriation $2,936.1 million 7

8. At What Level Do We Budget? Idaho’s line-item, incremental, program, zero- based performance budget  Base Budgeting - Incremental  By Program  By Fund  By Object Class 1) Personnel Costs: Salaries and Benefits 2) Operating Expenditures: Leases & Travel 3) Capital Outlay: Computers and Vehicles 4) Trustee and Benefit Payments: Services on Behalf of Another 5) Lump Sum: No Defined Category

9. Three Fund Types 1) General Fund: Sales Tax, Individual & Corporate Income & Product Taxes, Miscellaneous Revenue  Tax Commission 2) Dedicated: Taxes, Fees, and Penalties  Fish & Game 3) Federal: Grants, with or without match  Health & Welfare - Medicaid  Commission on Aging 9

10. General Fund History This table illustrates one challenge for the Legislature in setting the state budget when trying to manage growth. The largest five budget requests for agencies make up 81% of the General Fund, and the largest 13 make up 93.4% of the General Fund.

11. Caseload Matters

13. State Stabilization Fund Balances (in millions at the end of each fiscal year) $282.3M $389M