Medicaid, security among funding issues for legislators

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By David Meade

Columbia – Some of the state’s most influential Republican and Democratic leaders met with members of the press and media recently to preview the state budget and other issues that they are facing in the 2013 legislative session. Les Boyles presented an overview of the State’s $6.8 billion budget.

According to Boyles, the state will have a surplus of just over $47 million available to appropriate during the 2013 year due to a steady growth the state is seeing. Boyles said the state is experiencing an average of 2.2 percent growth which has gradually declined from 6.4 percent over the last three years.

The state has a general fund reserve of 5 percent at $11.248 million and a 2 percent capital reserve fund of $4.5 million. “The best we think they’ve ever been,” Boyles said, “since I’ve been working here for 30 years.”

Boyles said the state is dealing with a $7.1 million homestead exemption shortfall under the 1cent sales tax.

The funding goes to local school districts and is in place of property taxes on citizens.

The state will also see a 13 percent increase for employee health insurance amounting to $14.8 million and increases in insurance and retirement in 2014 amounting to $70.1 million

He said the two major drivers for expenses are medicare and medicaid insurance and healthcare and retiree growth.

Education funding for K-12, the EFA base student cost, will be maintained at $2012 per student amounting to $19.5 million with increased pupil counts and fringe benefits.

The state has set aside $55.1 million for school bus transportation and instructional materials.

The state has also set aside $36 million in the IDEA Contingency Reserve for a possible shortfall due to the loss of Federal funding. The funding was withheld by Washington because the state did not meet maintenance of effort requirements. He said the funding has been set aside in case current appeals are not successful.

Medicaid enrollment growth, inflation and federal mandates amounted to $142 million of the state budget after earmarked cigarette tax revenues were removed.

According to Boyles, 50 cents per pack is designated for medicaid, amounting to $10 million.

Other health and social service agencies are funded at $30 million.

Cyber security and how to pay for it is a big issue “which will be hashed out during the budget process,” he said.

The state paid $20.1 million for the credit monitoring arrangement with Experian due to the DOR data breach which must be covered by a loan repayment.

According to Boyles, the budget requests were over $1.1 billion and he said there were a couple of hundred million others.

Additional revenue sources include the tobacco settlement and the lottery.

The state budget includes a tobacco master settlement agreement (MSA) payment after June which amounts to $65-$75 million.

The payments were supported by state bonds that will be paid off and and will be available as part of the revenue stream.

Most, 88 percent will go to health care programs through medicaid and some will be used for economic development, Boyles said. The legislators will decide how to split the amount for allocation, he said.

The lottery is taking in approximately $30 million less than in the past, which resulted in a surplus last year. The surplus was used for extra lottery appropriations this past year.