As this article is being written, we are continuing to feel a great deal of concern about the state budget. Here is where the situation is at today:
Good news, hopefully:
- The 1017 fund will probably fund out through the remainder of the year. This may be a hopeful and optimistic statement, but it looks that way today.
- The $57,000,000 supplemental appropriation should get us through the end of the year with the flex benefit and replace funds taken out of the State Aid by previous cuts.
Unfortunately, the news in some areas is not positive. The items that follow are going to have a negative effect and should be considered moving forward.
- We are going to see a drop in funding next year. There are four fundamentals that will influence how bad this will be:
- The differential in the collected chargeables and the State Aid formula chargeables will be significant in some districts, which could have a distinctive multiplying effect if this seen in higher WADM districts.
- We know Motor Vehicles will be off due to the new formula.
- Gross Production is an outlier that could be accelerated because we won't see the worse part of the price decline begin until next month. We are indeed seeing a three-month lag in collections and payments.
- The extent of funds that are recouped in tax rebates that are set to expire within the next two years will drive down corporate income tax. We don't yet know the net effect.
- The ability of the budget-making process will determine the amount of the cuts. The issue then will revolve back to WADM population increases and the chargeables.
We have several new tools to help you in decision making that we will be notifying members of as they become available. Please don't hesitate to contact us if we can be of service.