Senate will tackle FY 2014 budget today
Published: September 30, 2013
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ST. THOMAS - As the final hours of Fiscal Year 2013 tick down today, the 30th Legislature will again take up consideration of the V.I. government's FY 2014 budget, along with other matters.
Today had been set aside as a possible third day for a legislative session that got under way on Thursday. By Friday afternoon, it had become clear that a third day would be needed, senators said.
The session has so far seen confirmation of four nominations, including those of three Superior Court judges; passage of six resolutions; and passage of more than 20 bills dealing with a variety of crime, policy and other matters. In addition, the 30th Legislature on Friday approved more than 20 budget-related bills, a number of them laying the groundwork for the FY 2014 budget bills that will be considered today, by moving money between different government funds for expenditure.
There are still a variety of measures that senators must tackle today, including the bills that appropriate the bulk of the territory's FY 2014 budget to departments and agencies, a bill that deals with revenue-enhancing measures in an attempt to close anticipated budget gaps, and a contract for government employee health insurance that will need ratification by the Legislature. The current contract expires tonight.
Senators said Friday that a small omnibus bill - which they have dubbed "the minibus" - to deal with revenue-generating measures to close projected budget gaps is in the works and will likely be special-ordered to the floor for consideration today.
"It's not going to be a big omnibus. It's going to be a 'minibus,'" said Sen. Clifford Graham, the chairman of the Senate Finance Committee.
Asked for examples of what kinds of revenue-enhancement measures might be included in the bill, Graham said there would likely be provisions which would provide some leeway for the governor to fill some "critical" positions to go after money that is owed to the government. He also said a "slight" increase in the "sin tax" for cigarettes may be included among the provisions.
As of Friday afternoon, the omnibus bill was still in the works, and Graham said at that point that he did not know how the final bill that will be considered today will look.
"I don't know what the full 'bus' is going to look like right now. The 'bus' is literally moving now," he said.
Additionally, senators are planning to consider the FY 2014 budget bills that will fund most executive branch agencies and departments, the miscellaneous section of the budget, the Legislature and the judicial branch today.
It typically takes a little time for the paperwork from a Senate session to make its way to the Governor's Office for review.
However, in the absence of an enacted budget - which requires not only Senate approval, but signing by the governor - the government will continue to operate after the start of FY 2014 at FY 2013 levels until a new budget is in place.
Senate president Shawn-Michael Malone said Friday that his office will be penning a letter to the Government Employees Retirement System, asking for the reversal of a GERS board decision Thursday that increases retirement system contribution rates.
The GERS board voted Thursday - five days before the start of the new fiscal year - to inject steep hikes into employer and employee contribution rates starting Tuesday.
The action came on the tail end of a budget season in which departments and agencies have spent months drawing up FY 2014 budgets based on current rates. Lawmakers already have been working to find ways to close anticipated FY 2014 budget gaps with a combination of cuts and revenue enhancements.
The move by the GERS board would increase employer rates by 3 percentage points and raise employee rates by 1 percentage point consecutively and cumulatively during the next three fiscal years. Under that action, for FY 2014, employer rates - the government's responsibility - would go from 17.5 percent to 20.5 percent and employee rates would go from 8 percent to 9 percent.
Board member Edgar Ross said that Gov. John deJongh Jr. had promised to include rate increases in the FY 2014 budget, but did not, and that the Senate has not addressed it.
Ross contends that the board had to take the action to be fiscally responsible. The retirement system is on track to become insolvent within 10 years unless something changes, according to actuarial studies.
Malone said Friday that the letter to GERS will be based on a provision in V.I. Code that requires advance notification to the Legislature about the amounts that will be needed for GERS contributions for the next fiscal year.
V.I. Code requires the GERS administrator, on or before Sept. 15, to prepare and file with the government's budget director and chairman of the Senate Finance Committee an itemized estimate of the amounts necessary to be appropriated by the government to GERS for the next fiscal year.
The law requires that those amounts "be sufficient to provide for payment in full" of the estimated obligations of the government to the retirement system for the fiscal year, as well as any obligations the government has to the system from prior years that remain unpaid.
Senators on Friday afternoon said they had not yet seen the proposed contract for government employee insurance that they will be asked to ratify today. The current contract expires with the end of the fiscal year.
There was an informational Committee of the Whole meeting on the matter in August, in which the proposal recommended by the Government's Health Insurance Board of Trustees was discussed.
However, senators on Friday said they had not yet received from the governor the actual contract that will need Legislative ratification.
The matter is on the agenda for today's meeting.
- Contact Joy Blackburn at 714-9145 or email firstname.lastname@example.org.