Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Reserve Accounts Consolidation topic
No spam. Unsubscribe anytime.
Appropriations panel agrees to interim study on reserve-account consolidation and school funding implications
Summary
Committee members debated bills to simplify reserve accounts and increase investment returns but agreed to send the packages to interim study, citing recent financial changes and potential short-term effects on school funding.
Lawmakers on the Senate Appropriations Committee debated a package of bills designed to simplify state reserve accounts, consolidate unused funds and increase long-term investment returns, then voted to send the proposals to interim study.
Representative Baer and other sponsors described a multi-year effort to “clean up” the state’s financial accounts and to move idle funds into higher-yield reserve accounts so those returns can flow back into the school foundation program and the general fund. Baer said similar work stretches back to about 2016 and argued the changes would make the state’s finances simpler and increase investment returns over time.
Baer told the committee the fiscal note for one bill showed a reduction of roughly $24 million per year from the school foundation program and roughly $28 million per year from the general fund; he also described an existing legislative backup — the Legislative Stabilization Reserve Account (LISRA) — that could cover shortfalls to the school foundation program if needed. On the size of an account targeted for consolidation, testimony referenced a large balance in an unused reserve account but did not provide a definitive, unambiguous figure in the hearing record.
Some committee members urged caution. One senator said adopting bills that would reduce near-term dollars available for education “would be a very, very, very provocative move” in light of a recent Supreme Court decision on education finance and suggested the proposals require further study. Another lawmaker said simplifying the budget structure would make it easier for new legislators and staff to understand where money is held and how it flows.
After debate the committee voted to conduct an interim study of the bills to allow staff and members to analyze the proposals and their short- and long-term effects on school funding and other state accounts. A motion to do an interim study was moved and seconded on the record and adopted by voice vote; the committee chair closed the meeting and announced a meeting for the following day.
The committee did not adopt any of the bills into law at this meeting; instead, members directed further review in the interim.
