The state’s budget accountants have wrapped up the balance sheet on fiscal year 2019, and it came with a nice gift for the state’s future.
General revenue funds came in 5.5% over the projections used to write the budget for the year that ended June 30, meaning the state had an extra $354.6 million. By law, that is deposited to the constitutional “Rainy Day” fund.
That puts the fund over $800 million, an all-time high.
Gov. Kevin Stitt says that’s not enough. Last year, at the governor’s insistence, the Legislature left unspent $200 million that was available for appropriation. In the state’s news release announcing the end-of-the-fiscal-year balances, Stitt said his goal is to build the state’s reserves to $2 billion.
There’s obvious wisdom in planning for bad times. We all remember the past decade. And if the state budget were in the right place, building a bigger reserve would be the right choice, but that’s not the case.
Due to unwise cuts in the state income taxes and a long state recession, Stitt inherited a government that was starved for funding. Successive years of budget cuts and budget failures meant public schools, state colleges and universities, health and mental health programs remain far short of where they should be. One good year doesn’t provide the kind of repair needed.
Not to be too cynical, but why stop at $2 billion? Why not dedicate all state growth revenue to reserves? Why not cut appropriations so we can have a $3 billion reserve or more?
The reason is that the business of state government isn’t building a bigger reserve. The job is meeting the state’s legitimate needs for basic government service. Until we meet that standard, the governor should keep his desire for more savings in perspective.
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