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Finance outlines state-operations and vacant-position reductions tied to 2024 budget control sections
Summary
The Department of Finance outlined final actions under control sections 4.05 and 4.12 that will reduce department budgets and eliminate vacant positions to meet savings targets from the 2024 budget act, while flagging that many earlier reductions would have affected mission-critical services.
The Department of Finance presented its implementation of control sections 4.05 and 4.12 from the 2024 Budget Act, which authorized the administration to identify reductions in state operations and eliminate certain vacant positions to produce multi-billion-dollar savings.
Han Dong Min of the Department of Finance summarized the exercise and said the administration identified that a significant portion of earlier-estimated reductions would affect services critical to public safety, 24-hour staffing requirements and mission-critical public benefits. Finance said it would implement current-year reductions by executive order after required waiting periods and proposed program and position adjustments for 2025–26 for legislative approval.
DOF said it expects to implement $1 billion in reductions to departmental budgets in 2024–25 (including $605 million General Fund) under control section 4.05, and proposed $1.6 billion in 2025–26 and ongoing (including $1.2 billion General Fund). Under control section 4.12, DOF said it would reduce budgets by $502 million in 2024–25 (including $195 million General Fund) and proposed $490 million and the elimination of 6,002 vacant positions in 2025–26 and ongoing.
The LAO said finding state-operations reductions that do not affect public services is difficult and that departments provided limited detail about how reductions would be achieved. Committee members pressed DOF for the rationale and asked for department-level impact information and the effects on special-fund fees and taxes. The committee requested supplemental detail on anticipated service impacts and potential fee changes.
Why it matters: These control sections and implementing actions affect departmental budgets, special funds, and the size of the state workforce and will be implemented quickly in the current budget cycle.
What’s next: DOF agreed to coordinate with departmental analysts and provide additional information to the committee on department-level impacts and anticipated effects on fees and operations.
