BRN fund condition shows months in reserve rising as board office outlines budget roles

Department of Consumer Affairs budget staff briefed the Board of Registered Nursing on May 28 about the board’s fund condition, projected expenditures and the board’s fiscal responsibilities under state law.

Budget analyst Luke Fitzgerald and colleagues presented the board’s fund condition statement and month‑by‑month projection figures, noting the board ended fiscal 2023–24 with a reserve balance the presentation described as about 27 million (roughly six months of reserves) and projected an out‑year balance that totals more months in reserve depending on revenue and repayment assumptions.

Fitzgerald told the board that 2023–24 appropriations were roughly $66.5 million with an estimated $61.5 million spent, producing reversions. For 2024–25 the board’s appropriation was about $65.9 million with projected expenditures giving a small reversion. The presentation said a significant loan and repayment to the General Fund and variations in endorsement revenue drove much of the year‑to‑year change, and that personnel costs, operating contracts and enforcement (AG/OAH) are major expenditure lines.

Budget staff emphasized that the fund condition is a snapshot and noted personal‑service adjustments (employee compensation and retirement rate changes) as the main driver of future cost increases. Staff explained that standard practice is to include a conservative ongoing 3% increase for planning in the out years and that any future legislation or unanticipated events could create pressure on the fund.

DCA budget office staff also presented an overview of the state budget process (governor’s budget, May revision, legislative spring process and enacted Budget Act) and explained incremental budgeting methods, budget letters and budget change proposals. Staff described recent statewide budget letters that will affect board appropriations, including vacancy‑savings and position elimination directives and a government‑efficiency reduction letter tied to larger statewide reductions.

Sam Dyer and Suzanne Balcos (DCA budget office) reviewed the board’s duties as fiduciaries of the fund, described the monthly reports the office provides and showed how months in reserve are calculated. They reminded members that statute and the Budget Act prohibit expenditures in excess of appropriations and said the budget office monitors spending to prevent such occurrences while noting mechanisms (e.g., reallocation/augmentations) exist if unavoidable costs arise.

Board members asked about the size of the reserve and vacancy sweeps; staff said the reserve level was healthy though the administration has set maximum months in reserve in statute and that vacancy reductions (position eliminations) had been applied to the board’s authorized positions as part of statewide adjustments. Board members also raised enforcement‑cost pressures and workload trends such as higher complaint volumes.

Budget staff said bargaining‑unit salary adjustments are accounted for (a 3% planning assumption was included) and warned the May revision could alter final assumptions. The presentation concluded with suggestions for board priorities (monitoring appropriation, workforce and enforcement costs, legislative impacts and fee decisions) and an offer to provide the board with additional materials and the slide deck.