Why Doesn’t the State Report Monthly on Its Budgets?comment (0)
November 11, 2010
By Jim Williams
On Sept. 16, the governor reduced the state’s education budget by $113 million to keep it in balance. His “proration” order, which cut payments to public schools, colleges and universities, came only two weeks before the fiscal year end. School administrators had little time to react to this large, sudden loss of funding from their budget plans.
While I understand the governor’s duty to maintain budget balance, it seems to me that Alabama should do everything it can to make sure those who manage public services have as much time as possible to prepare for midyear budget cuts.
There is a simple tool for keeping everyone informed about the status of the state’s General Fund and Education Trust Fund budgets: It’s called a monthly report. Many states report every month on the condition of their budgets and we could, too. Putting such a report on the state’s website would ensure broad access to the information. The ingredients that would have to be in such a report include the beginning balance for the fiscal year, the revenue forecast, spending authorized and the expected ending balance. During the year, changes in revenue and expenditure estimates would be factored into the reports, along with their impact on the ending balance. This wouldn’t change the need to take action when conditions turn sour, but it would give notice of it changing as the year progresses and improve the ability to adjust to them.
Reports of this type are presented at the start of each legislative session by the governor’s budget staffs and Legislature to guide the development of state budgets. They aren’t maintained in a public way thereafter. In addition, an Open Alabama website already exists, with hundreds of pages of monthly tables on state revenues and expenditures. Unfortunately these undigested tables give no sense of state budgets condition. The transparency is commendable but the state should produce clear monthly reports on the budgets’ bottom lines. I think the state Finance Department should be required by law to do so.
EDITOR’S NOTE — Jim Williams is executive director for the nonprofit, nonpartisan Public Affairs Research Council of Alabama. Jim may be contacted at email@example.com.