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Friday, August 23, 2019

NOTES FROM THE SENATE, AUGUST 23, 2019

WHAT DOES A $27 BILLION BUDGET BUY YOU?

Some, for whom complicated things are always very simple, often decry the size of the state budget and note "It was only $20 billion or less just a few years ago." After many years of observing government and actually writing budgets, there are a few truths that I have observed not just of state governments, but of all levels of government that spend taxpayers money.

There is always a perceived need for expansion of government, more positions, more bureaucracy and more land for government functions.

These costs continue to rise and the only way to reduce their growth is some kind of tax cut or payment back to taxpayers periodically or from budget cuts.

Employee benefits, whether better or trailing private industry, will never be perceived as sufficient and there is always pressure to increase them.

One positive of a recession is tighter spending, employees' stability and less pressure on elected officials to increase budgets.

The state as a governmental entity is somewhat different from local governments. The state of Georgia depends on the state Income tax, levied on individuals and businesses, a tax with many exemptions and credits. But, nevertheless, this is a fixed income tax and the state does not control what comes in. The other major source of tax revenue for the state is the state sales and use tax that applies only to certain purchases and again, has a number of exemptions.

Here is a list of the major tax and fee sources that fund state government:

Individual Income Tax 52% $12.7 Billion
Sales and Use Tax 27% $6.5 Billion
Fuel Tax/Fees 9% $2.1 Billion
Corporate Income Taxes 5% $1.2 Billion
Tag & Ad Valorem Taxes 2% $1.0 Billion
Other 2% $844.03 Million

SO, WHAT DOES A $27 BILLION STATE FUNDS BUDGET GIVE THE CITIZENS OF GEORGIA

Percent of State Funds Actual Amount
Education 54% $14.9 Billion
Pre-K 1% $378.7 Million
K-12 39% $10.7 Billion
University/Technical 10% $2.8 Billion
College
Student Scholarships 4% $1.0 Billion
for Higher Education
Medicaid & PeachCare 13% $3.6 Billion
Roads & Bridges 7% $1.9 Billion
Corrections, Supervision, 5% $1.4 Billion
Pardons And Paroles
Debt Service, 5% $1.37 Billion
Restricted Uses
Behavioral Health/ 4% $939.1 Million
Disabilities
Human Services 3% $830.6 Million
All Other Agencies (Judiciary,Public Safety, Secretary of
State) 9% $2.5 Billion

WHAT ARE SOME OF THE CAUSES OF INCREASES IN THE BUDGET YEARLY?

Enrollment-From 2010, the low point in the budget for the last 10 years to 2019, here are the increases in enrollment in the various state programs that are funded through formulas:

Increase in Enrollment
K-12 Education FTE's 112,026
Regents FTE's 21,728

Entitlement enrollment and prison inmates:

2010 2019 Increase
Medicaid Enrollees 1,447,465 1,943,546* 496,081-- Net 385,501
PeachCare Enrollees 202,527 124,181* -78,346
Inmates 52,291 55,047 2,756
Probationers 154,922 204,370 49,448
*2018 figures.

During that same period, Georgia's population was estimated to increase 831,822.

EMPLOYEES IN STATE GOVERNMENT

Positions that are filled make up the population of state employees that include those who work in state government, Board of Regents and TCSG staff, employees and faculty and includes K-12 school teachers paid by the state QBE Formula. The chart below shows the number of filled positions in 2010 and the number in 2019.

Agency 2010 2019
Public Safety 1,691 1,870
DHS Division of
Family and Child Services 6,748 6,241
(DFCS)
Agriculture 635 519
Natural Resources 2,149 1,762
Public Health Counties 4,809 3,897
DJJ, GDC, DCS 16,407 14,296
Forestry 568 559
General Assembly 476 450
Governor's Office/Agencies 420 332
Public Defender's Council 738 754
Secretary of State 293 268
Technical College System of GA 5,366 5,699
DOT 4,975 3,954
Regents 42,304 49,721
Court of Appeals 78 109

So, it is readily apparent that state government has not grown much in the number of employees. Keep in mind that the state's population grew by approximately 831,822 people from 2010 to 2018.

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