As expected, the Senate Appropriations Committee passed a stop-gap measure this morning that will keep the state government running during the first 30 days of the next fiscal year that starts on July 1st. The closed-door negotiations over the tax plan continue to hold up the budget process, prompting legislators to miss the June 30th deadline for passing a two-year spending plan.
The resolution permits state agencies to spend up to 95 percent of their authorized budgets from the current fiscal year. The Office of State Budget and Management is tasked with determining how to trim the other 5 percent. Budget writers claim that a reduction is required to make up for a projected spike in Medicaid checkwrites resulting from a switch to a new payment system that will begin on July 1st. In an unusual move, the measure also appropriates additional dollars to address the Medicaid shortfall by using unspent dollars, overcollections, agency reversions, and a portion of the TANF block grant.
It is not uncommon, however, for legislators to pass such a measure—which is known formally as a Continuing Resolution—if they anticipate missing the June 30th deadline. The last stop-gap measure was approved in 2011 amidst a spending showdown between then Governor Perdue and the legislature.
The measure is headed to the Senate floor before it is sent to the House chamber.