16 May 2011

Committee action, May 16: SB 147, SB 171, SB 113, SB 114, SB 218

SB 147 by Sen. Pres. Joel Chaisson would address what he termed a flaw in the workings of the Budget Stabilization Fund. He told the Senate Finance Committee when it hits its maximum, money that goes out has to come right back in. He wished to change it by allowing a phasing back in deposits, because otherwise the process meant a refilling almost immediately if the fund was at its maximum (caused by “excess” mineral revenues, when the fund is pushed over $850 million). Under this proposed constitutional amendment, the second fiscal year after use would require a quarter of it to be paid back annually until all last taken or the constitutional cap (at four percent of state receipts) was reached.

After amendment without objection, the committee reported favorably without objection. Then its companion SB 171 was dealt with similarly.

SB 113 by Sen. A.G. Crowe would increase budget flexibility for times of budgetary deficit, who noted 71 percent of the current budget in some way was locked in to specific spending. Crowe noted that the current five percent variance allowed applied only to state funds, so his bill would allow the variance when a deficit came from state and/or federal revenue.

Sen. Lydia Jackson wondered whether some kind of distinction could be made between recurring and nonrecurring federal revenues, applying the bill only to the former. Crowe said he had some amendments she might find interesting. One amendment said the cut could come only if state funds would have to be increased as a result of the reduction in federal funds. Jackson said it was good but didn’t go far enough, and didn’t know if there was a current definition regarding federal funds, but said one could be written in before the bill hit the floor. Crowe was agreeable, and that amendment was adopted without objection.

After a couple of technical amendments were adopted, without objection as well SB 113 was adopted. Its companion SB 114 then got the same treatment.

SB 144 by Sen. Mike Walsworth would create a comprehensive review and sunset mechanism for statutory funds to collect a specific fee for state government. He announced an amendment that would largely moot his bill as written, it amended making the Joint Legislative Committee on the Budget to give a formal positive evaluation on a fee or it gets sunset, only when brought forward by the Division of Administration. Sen. John Alario wanted to know whether the Legislature still could do this, and Commissioner of Administration Paul Rainwater answered affirmatively, that it only was to bring attention to funds potentially not needed.

Jackson wanted the process as one where the entire Legislature would decide on a sunset through legislation that would wipe out the enabling legislation as well. Sen. Edwin Murray wondered whether this even was procedurally possible as written, but as Walsworth noted, Jackson’s idea would accomplish this, and he was amenable to it. But when the amendment-on-the-fly was presented, Jackson wondered if its language would permit the program’s continued existence, in case they wanted to keep the program but fund it by appropriation. After extended discussion, the amendment was changed, the adopted without objection, followed by the bill’s passage.

SB 218 by Sen. Joe McPherson would make more logical and flexible the process of contract leases of state assets, specifically prisons. The previous law allows two prisons contracted for as many as 20 years, and the bill would allow immediate realization of all funds then amortized over the life of the contract, subject to annual appropriation. It would actually increase costs of the buyer, and therefore passed through to the state, because of taxes paid up front and cost of capital. Alario wondered whether this would apply to the limit of net state supported debt.

Sen. Jack Donahue wondered why not just sell it totally, but McPherson said he thought the state still would get more by having a pre-paid lease. Donahue, however, thought otherwise, but McPherson said he merely wanted to have an alternative to a straight sale, perhaps not as much money as a straight sale but a lot.

Jackson moved for approval, and without objection it was.

Staff, somebody help us here
Jackson, when trying to figure out the exact wording on SB 144, illustrating the heavy dependence that legislators have on each chamber’s staffs to get bills drafted with language to express their exact intent.

That’s my insider information, as a floor leader for the Administration.
McPherson, mocking his pariah status in regards to the current gubernatorial administration.

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