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Committee directs $60 million reduction in other-funds authority after federal COVID funding drop; staff to track FMAP change
Summary
Budget staff and committee members agreed to remove $60 million of other-funds authority tied to federal COVID-era public-health dollars the state no longer expects to receive, and to reflect preliminary FMAP changes in the long sheet pending final federal confirmation.
Senate appropriators directed staff to reduce the department’s other-funds authority by about $60 million to reflect federal COVID-era public-health funds they do not expect to receive, and they instructed staff to include a preliminary 1% FMAP (federal medical assistance percentage) adjustment in the long sheet.
Department budget staff told the committee that the federal government has signaled the state will not receive roughly $60 million in COVID- related public-health funding planned for fiscal 2027, and the department said it does not need spending authority for funds it will not receive. "It is authority for me to spend money I will never get," Donna said. The committee agreed to reduce the other-funds authority accordingly; staff said the reduction will appear on the long sheet as a $60,000,000 decrease in other funds and does not change general-fund totals.
Members also reviewed preliminary FMAP figures. Staff reported a tentative move from 50.0% to roughly 50.99% for FFY 2027, which would shift some costs between state and federal shares; staff estimated this preliminary FMAP adjustment would change Human Services totals by a small amount and identified $8 million split across two areas as an estimate to reflect in the long sheet. Budget analyst Keith said the committee already adjusted for about a $1.9 million FMAP-related change in one line and that preliminary FMAP numbers will be final later in the year.
Staff explained that if the federal government later reverses course and sends funds, the department would request authority from the state Emergency Commission to draw down federal funding. "We would have to go to the emergency commission and request money, federal authority through that means," staff said. The committee asked staff to update the long sheets to show the $60 million other-funds reduction and to note the tentative FMAP adjustment for budget purposes.
