Pine Belt lawmakers explain special session on budget shortfall

Pine Belt lawmakers explain special session on budget shortfall

HATTIESBURG, MS (WDAM) - Pine Belt lawmakers are preparing to head back to Jackson Tuesday after Gov. Phil Bryant called for a special session session to address a gap in the state's 2016 budget.

"The governor has called us back, and for a special session we can only deal with whatever is on his call," Sen. Billy Hudson said, who represents Forrest and Perry Counties. "What we hear is that there's just going to be one issue: the shortfall of the budget. The committee that estimates the revenue increase for the year, made up of the state treasurer and state economist and several other experts, simply underestimated the increase this year. I've been there eight years, and they've never missed it. But this time, they did."

Forrest and Lamar Counties Rep. Toby Barker said actual tax revenue has been lower than the state's estimate for several months, and so far, that trend is continuing in June.

"Right now, revenues for the fiscal year are anticipated to fall below what was projected," he said. "Fiscal year ends on Thursday, June 30 , and so that creates a need to fill the gap, to try and plug the hole for the rest of this fiscal year. Currently, we're between $60- $70 million short of hitting the end of the fiscal year estimate on June 30. Right now, June collections are at $556 million. To make the June projection, just for the month, we would need to get to $684 million, which is very possible because there's some accelerated tax payments that haven't come in yet. But to make up the entire gap, June collections would have to be $751 million, and I don't think that's likely."

Sen. Joey Fillingane, who represents Covington, Forrest, Jefferson Davis, Lamar and Smith Counties, said he was surprised the governor called a special session before the end of the fiscal year.

"This is really more of a precautionary type measure that I think the governor wants a little bit of cushion in the event that we fall a little short of the projections by the end of the month for the entire fiscal year that he would have the cushion he needs to go ahead and make those budgets whole," he said.

The cushion is coming from the state's Rainy Day Fund.

"We have to carry a balanced budget as a state," Barker said. "That's in our state law. The governor can go $50 million into the Rainy Day Fund without legislative approval already. However, he's already done that. Twice. He's taken $45 million of the $50 million that he can (take) out of the Rainy Day Fund, and there's still a gap, even after two budget cuts that he's made midyear. So that necessitates the legislature coming back, transferring the money from the Rainy Day Fund into the general fund to ensure that we're balanced by the end of the fiscal year, and also to give us some beginning cash for fiscal year 2017."

Fillingane said, "I think (Gov. Phil Bryant) didn't want to be in a position to where we wake up on July 1, and there's a $10 million or $20 million or $30 million hole and no way of plugging it. He had already used all the authority that he had, he tells us, to dip into the Rainy Day Fund without additional authority from the legislature.So that why (there's) the need for the special session now before the end of June."

Hudson said, "We're in the last few days of this fiscal year, so the governor can't make another cut. So they only way we can solve this is to have a special session and take some money out of the Rainy Day Fund. We have $350 million in the Rainy Day Fund. The state's in good shape. We're just going to have to take about $50 million, I understand, out of that (and) put it into the general fund to pay all our bills."

Fillingane said, "The worst case scenario, I think, is $70 million, which to you and me and our constituents sounds like a ton of money, but to put it in perspective, if you take the state budget and compare it to like an annual, individual's income, so let's say you make $30,000 a year, we're talking about giving them the authority to borrow $300. We finish session in April, and the fiscal year doesn't end until the end of June. So we're operating on a bit of a two to three month window where we're not certain what the revenue is actually going to come in at. We try to predict, and we hope that it's accurate. But some years, it's just not quite there."

The special session is funded by Mississippi taxpayers, and Gov. Bryant said in a news release Monday he is urging "lawmakers to complete their work quickly, to keep taxpayers' costs as low as possible."

So how much will taxpayers pay to send lawmakers to Jackson Tuesday?

"I asked that question myself because we haven't done this in several years," Hudson said. "It totals $21,000. We get $140 a day, plus $75 if you're in a special session, plus mileage from wherever you live (based on) whatever the federal rate is. It comes to about $21,000 for the Senate per day, so hopefully we can do it in one day. None of us want to do this. We don't want to have to do this, but it's just something that's necessary we're going to have to do."

According to Laura Hipp, communications director for Lt. Gov. Tate Reeves, a one day special session costs $68,720 both the House and Senate. Hipp said that total includes salary for one day of work plus travel to and from their districts. She said if the session lasts more than one day, it costs both chambers $47,674 every day after the first.

"It should be a one-day thing," Hudson said. "It should be a short thing. I can't imagine anybody voting against it. The state's economy is good. All our bills are paid. We don't have a deficit like the federal government or some of these states, and we've got money in savings. We just have to move some of it to get our bills paid. I expect it to be a one-day session. There's always a possibility that somebody will hold us over with a motion to reconsider and have to make it a two-day session, but hopefully we can go up tomorrow early. We go in at 10 o'clock and be home, hopefully, tomorrow afternoon."

Barker said, "I hope this takes a couple of hours, and we're done. But I have learned that when they tell you one day to go ahead and pack for three."

Fillingane and Hudson said the legislature ended its regular session a few days early, and the money saved then can be used to help fund the special session.

"We did shave off a good 10-15 days off of the regular session calendar, and so that savings can be realized now," Fillingane said.

Hudson said, "There's money left over that we did save."

The money taken from the Rainy Day Fund will be put into the general fund to be used as needed, not used to fund specific agencies or programs.

"We can't argue over the specific things or specific agencies or entities because that won't be on the call," Hudson said. "That'll be for next January when we go back. We just need to do this, get it over with, get back home and not waste any state taxpayer money, and then be ready to go back in January and do a better job."