JAC Index011916am1 Mark-up The motion is the Governor’s Recommendation. Amendments may be made to the Governor’s Recommendation Voice vote, unless there is a call for a show of hands. Format A for agency, followed by the number aka Department D for division U for unit 1/19/2016 8:02:24 AM Meeting called to order by Chairman Ross Roll Call all present Ross: Matt Obrecht and Dave Grover will speak about the budget process. Gruver: Memo – Most of the work done by Obrecht. Background. Appropriate contents of a budget bill. Management Council compilation of LSO memos and case law. There is very little Wyoming Case law. Based on history and courts in other states. Page 3: 4th issue –ordinary expenses does not modify public schools. You can put a lot in budget for schools. 1924 Case about Wyoming National Guard. Constitutional requirements to support public schools. WCDA Case – You created this state instrumentality. Separate body corporate. Supporting administrative expenses of that entity was ordinary expense of government. Other states have taken the same view. Almost everything you do within govt. falls within one of those three departments. Page 9 – Test. Explanation. What are the 3 branches of government? Pg 11 South Dakota Court- power of appointing belongs to the Governor so in a broad sense is executive Page 12 – special attention to UW. Other states have within their constitution. We do not. UW mandated by constitution, mandated to support the institution. In 1893 there were other charitable organizations in the general appropriations bill. Arguments for UW funding to be outside of bill. The better argument is that it can be within the appropriation bill. Footnote about other institutions. Funding formula by statute for the community colleges. Community College Commission appointed by the Governor. Capital construction- other states do a flip flop on this. Colorado, Montana, Local Government: 2000-2001 earmarking. Grant and loan program through SLIB, funded with mineral taxes and FMR. Political subdivisions with home rule. Direct distributions through formula in substantive law is more problematic than some of the other expenses funded through government. Substantive law issue: Best thing to tell you is on page 14 – former AG Joe Meyer says to look at each one on a case by case basis. Reviewed past language. It is hard to figure out on a case by case basis; need to know current law (if there is current law), how broad it is. General Rules: If you have legislation on the books and you change that legislation in the budget bill, it is a red flag. Severance tax issue. You are appropriating those funds, to PMTF, continuous appropriation. But for that change to the law, you would not have that money to fund that appropriation. Perkins Gruver: Limit to the budget period. What has been done in statute is to make appropriations to a certain place. Underlying argument is that a legislature can’t bind a future legislature. When you have continuous appropriation, you are binding future legislatures. Harshman: Page 14 and 15 – former AG Meyer. Temporary modifications of substantive law may be permissible. Gruver: South Dakota case. Harshman: Some states allow raising of funds in the budget bill. Gruver: New Mexico and Ohio. LSO position is you can’t have a tax measure in the budget bill. To do so, converts the budget bill into a revenue raising bill, which has to start in the house. How do you have a revenue raising bill when it is a single subject? WE put that in as an outlier to the permissive side. Harshman: page 17 – school cap con as a separate bill. We separated it out 5 or 6 years ago Gruver: Strong argument that you could keep it in the general appropriations bill. Just because you can does not require that you do. Connolly: AG ruling and footnote. Do you agree or disagree? Gruver: We changed that footnote because it indicated there was flat out disagreement. The AG spoke to it that you can do it. LSO memo. Distinction. Two different scenarios presented Connolly: Statutory diversion. Can it be changed in the budget bill? Gruver: There is a strong argument to be made that you can do that. No absolute. I will stay with the LSO view. Connolly: School Cap Con – we will have separate bills for cap con and school cap con. We do not have to do that at all. If we have legislation that sets up a program, there are ordinary expenses, need a building. Gruver: Two part – 1st is public schools. Ordinary expenses do not modify for public schools. Wyo. Case law and constitutional provisions is easier case to say it is fine in appropriations bills. Cap Con for other buildings has further test of recurring or exceptional. Ex: building a new building is not ordinary, it is exceptional. LSO in 1994 said budget bill should contain just appropriations. Can have conditions on the appropriations. There are boundaries. Pay attention to separation of powers. Example: expenditure is for parking lots. Saying it is for 104 parking spots is encroachment on executive or department. Pay attention to what is in the statutes. To change those things in budget bill is not having the fair debate. Greear: We can defund a program. If you partially cut a program set by statute and it has 3 components, does it have to be pro rata? Gruver: Case by case basis, look at statute. Referred to case. If you have a program, with entitlement and readily calculable by the statute, good question, if it can be changed in the budget bill. Do you have to fund it? Answer is probably no. Most of the times you can take money away. Greear: Minerals committee legislation – putting FTE’s in with specific purpose. If we are cutting FTE’s, are they sacred? Gruver: No definite answer. Colorado does not allow the legislature to specify the number of employees. We always have done that. Putting FTE’s in separate bill does not make them sacred. Red lining specific provisions has to be questioned. We have a general process. Cannot fund program and have general statute in place for where positions go, have Aand I with rules. Burns: Strict constructionist view. Why wouldn’t the Governor be just as constrained on his B11 process? Gruver: I am not taking a strict constructionist view. The B11 authority is set by statute. Fair debate allowing the Governor to do this. Changing this in budget bill is changing the general statutory authority/ Burns: If we can convey the process to the Governor, does it convey it to the legislature by signing the budget bill. Gruver: Issue is debate. Obrecht: Explanation Burns: Obrecht: Explanation – No, I think that is clearly within the purview…. Ross: Governor has been given B11 authority. He gives a position, now we want to cut it. Are we running afoul because we do that? Obrecht: Statutory framework in Amanda. Potentially violate separation of power in budget bill. You cannot fund the appropriation. Ross: Use of 900 series money to change to 100 series through the B11 position, which was not authorized in the budget process. Can we say we do not approve that? Obrecht: Rely on existing statute outside of the budget bill. Connolly: Exception requests as well? Increase in county attorneys in Campbell County. Obrecht: If the request comes from the executive branch, it is an ordinary expense for a continuing program. If there is a specific footnote, saying x attorney positons shall be created. Could be a violation. We feel if that request comes from Executive branch, more likely to be considered an ordinary expense. Connolly: Executive branch, vote up or down. We vote down, and then goes to the floor. Individual legislature amends it. Governor denies recommendation for additional attorneys, individual legislature brings it up. Is that the violation you are talking about? Gruver: Who brings it up is not controlling it. Further explanation. Conclusion: We have not given absolutes. Given you a roadmap. Our duty is to advise you. We are not a constitutional gatekeeper. Posted on the website. On a case by case basis, we will give you our best advice. Greear: Budget bill does not require introductory vote. Will separates like cap con, have to go for introductory vote, run cap con as a mirror bill? Gruver: Provision for the 2/3 vote came about with govt. organization effort in 1969. There is a contradiction. Anything other than the budget bill – singular- requires 2/3 vote. Reorganization committee talks about budget session, anything not having to do with the budget has to have a 2/3 vote, which was even broader. Seems to say anything having to do with the budget does not require 2/3 vote. Perkins: singular as a budget bill – we could have separate bills, multiple general appropriation. We would have to pick one? Gruver: There used to be multiple appropriation bills for general operation of government. Bills you are wanting to split out are not for general operations. Perkins: If you can’t have omnibus bills, each capital construction project, would have to be done separately. Gruver: You can argue that. Provision says all other appropriations have to be by separate bill with a single subject. Wyoming Supreme Court has allowed a broad definition. Argument is that all state capital construction projects are a single subject. It depends upon how a court views the constitution. Constitution does not change meaning versus it is a living, breathing document, applied to how things change. Budget bill has grown as has the function of government. SD- to require each one to be done as a separate item could not be done in time frame. 1/19/2016 9:02:06 AM Break. 1/19/2016 9:14:00 AM Ross: Meeting called back to order. Harshman: Global motion applies to all agencies across the board. Ross: Budget open for consideration. Greear: move for entire budget, to amend anywhere where there are Governor Recommendation to put GF instead of LSRA, seconded. Harshman: would take us to one bottom line. More transparent. Nicholas: For our GF BRA expenditures, we want to use GF BRA for ongoing expenditures. IF we need to tap into LSRA it should be for one time. No negative parameters, live within our budget. Greear: Allows us to see what our ongoing expenses are, to see match. Stubson: motion contemplates taking off the table for now the statutory repayment provision. Greear: yes MOTION CARRIED Harshman: Austerity Measure. Penny plan. Take 1% the first year, add another % the second year. Future legislatures can add if need be. Gives the Governor great flexibility. Some agencies can take the 1% cut, some can’t. Governor’s office has latitude. Richards: 43+M – interpret 1.5% of the biennium so 1% the first year and 1% the second, so average Ross: Motion is giving the Governor the authority to cut 1.5% out of the budget with flexibility to decide where. Harshman: May be able to refine and to set a date, like May 1st. Members may want to exempt programs. Start the drawdown so ongoing type expenses match ongoing type revenues. I have been part of 5 and 8 % cuts. This would be a more gradual draw down. Motion seconded. Nicholas: Clarification 1% for the first year, 2% for the second year. Governor flexibility. What is the process if the Governor does not make the cuts? Is he mandated to make cuts from all agencies. My preference is that it is mandated for all agencies Ross: open for discussion Richards: Does the money get taken out of each agency and governor has ability to move the money or is there a pot of 44M and Governor chooses. Burkhart: To require the cuts be made and let the Governor choose where he wants to make them. It is a required cut. We have cut 1% this year and 1% next year. Governor can get the money from where he wants. Greear: Book it 1% against each agency and give the Governor the authority to move it around. How do we track it? Additional cuts affect the bottom line. Connolly: Timing question. Why now, rather than Friday, when we know better where we are with the budget. Harshman: 465M reality, going to move Cap Con and Locals out of there. Substantial amount. However you want to do it, at the beginning or the end. I do not want to come back with automatic 10% cuts across the board. Do this up front, move marker down from the beginning Stubson: Accountability is fairly easy because you are setting the dollar amount, 44M cuts for the biennium. Flexibility for the years. Give Governor maximum authority across agencies and time. Moniz: Is the cut based on today’s balance or the end of the week balance? Richards: We can only cut the standard budget so 1% and 2% of the standard budget. Nicholas: What if the Governor does not come up with the 44M, what is the next step. Ross: Special session Nicholas: That should be in the motion. If it is just a blank 44M, do we say 1% from each agency and Governor can move around? Perkins: No. Clarification – separation of powers, does this extend to the judiciary branch. Governor does not have power to adjust the judicial budget. Harshman: Applies to the Governor’s standard budget right now. Will deal with those when we get there. Ross: Motion: It is a figure of 44M dollars with discretion for the Governor to find that wherever he finds it but each agency does not have to cut one and one? MOTION PASSED 1/19/2016 9:30:01 AM Burkhart: Cut all exception request for IT hardware by 50%. There are a lot of IT requests that I can’t get good information on. Burns: The 1% is on top of all other motions forthcoming? Perkins: No. prior motion is on the standard budget. Williams: Object code 242 for Representative Burkhart. Perkins: on and against the motion. All IT not equal. Greear: Oppose the motion. Poor technology does not allow efficiencies. Burkhart: does not impact efficiencies, they already have. Cut it 50%, they can decide how to spend it. This is growing constantly. Wasserburger: Buying replacement every 4 years does not match others. Do not have to buy everyone’s technology in the same year. Ross: Most IT things have been disapproved by the Governor and some are funded by special revenue funds. Look at them on a case by case basis. Hastert: On and against the motion. MOTION FAILED. 1/19/2016 9:35:03 AM Harshman: Reduce in state and out state travel across all budgets by 10%. second. Nicholas: in favor of the motion. Richards: About 1.5M total. My numbers include the Judiciary. Nicholas: Move to amend to include the judiciary Ross: Friendly amendment Burns: move to exclude the Judiciary – opposing the amendment Perkins: on and against the amendment to the motion. Judicial , you want them traveling. Nicholas: Of course we want the judges to travel but every agency should recognize the fiscal constraints. Judiciary budget contains travel for other reasons like conferences, etc. Amendment to include the judiciary in the 10% reduction to instate and out of state travel. Show of hands six to six. Amendment failed Motion: 10% cut of travel Connolly: Resist the motion Harshman: As we look at each agency, we can see the ones who can’t take the cuts. Hastert: Resist the motion. Each program within each agency has travel and can see where they have cut it. Burkhart: agree with the co-chairman. As we go through the budget, we can reinstate it and if you want to cut a budget more, we can. MOTION PASSED 1/19/2016 9:42:51 AM Harshman: Reduce permanently assigned vehicles by 2.5%. Pushes the replacement out on the mileage of a vehicle. Seconded. Discussion: Burns: Against the motion because we have put in travel restrictions. Remote nature of state Nicholas: Question on motion. How is it implemented? Who makes determination? Harshman: The executive makes those decisions. They have authority to do so. Let the people working everyday decide. Burkhart: cut in number of vehicles or dollar amounts? Harshman: Don Richards: It is a dollar amount across all agencies. Ross: about 160 grand. Motion passed. 1/19/2016 9:46:46 AM On all of these we are assuming they do not apply to the judiciary. Harshman: Universal fashion. Reduce the 900 series by 5%. When we open agencies that are all 900 series, we will exempt them. Do no harm to agencies that are primarily all 900 series. That series has grown. In budget reduction times, that is one of the series that gets cut. 9.5 to 10M Ross: 9 to 10 M? Seconded Burns: Across all agencies or at discretion of governor? Harshman: Across the board. We would use our discretion. Greear: To make this cut, we will have to be careful. Ross: Does this apply to construction management? Include that kind of thing? Richards: As part of their operations budget. In terms of construction of a building, that would not apply because it is series 700. These motions are on the GF portion. Stubson: on and against the amendment. Burns: I agree. Ross: Question on motion Show of hands. Six to six. Motion failed. 1/19/2016 9:52:33 AM Connolly: Delete any contingency allowance 0702 object code. Testimony from community colleges. Greear: Harshman: Appropriate when we open agency Connolly: withdraw motion 1/19/2016 9:53:40 AM A001-GOV 0101 page 11 Richards: first vote on page 14 Greear: move to reduce 5% Stubson: Move to reduce 900 series by %5 for the entire agency. Richards: Clarification – This would be for the std. budget. Page 4 column 3. Exception requests stand alone. Only grabbing General funds. Greear: second amendment to the motion. Ross: reduce 900 series by 5% for the agency. Richards: Will have to go back and calculate the number. Column 3 page 4 2,347,180 Greear: is it all general funds Richards: no. Connolly: note that 2.2M is FNRP Williams: Standard budget in that unit is zero. Page 88. That budget would not be impacted at this point. Connolly: Williams: Would not apply to this unit. Richards: We do not know if we can calculate the GF portion across the board. Each agency does not fund each line item by GF or Fed. Funds. Hastert: Governor Office – What is 900 budgeted for? Richards: We will do the best to incorporate the intent. We will have to estimate it. Stubson: Withdraw my amendment to the motion. Greear: Go unit by unit or go back to the global motion Williams: The GF will be an estimate no matter the type of motion. If budget has other federal funding sources, it may be limited to a certain series. We would determine a relative percentage for each budget. That is how we would calculate the potential GF impact. Greear: My motion was on unit 101. Ross: Motion to reduce contractual services on page 13 by 5% Second Nicholas: Amend the motion to apply to the entire agency. Second Discussion Hastert: What does the Governor office do with 900 series? Examples of what we are cutting? Burns: page 29 – professional fees for tribal liaison. Against the motion Greear: List of contractors on 900 report. Burkhart: Mostly food and meetings. Not sure 5% is enough. Ross: Amendment to the motion to make it across the agency Stubson: Would you give discretion to the agency to where they place the cuts? Nicholas: yes, not every unit necessarily but it has to total 5% Burns: Amend the amendment - omit page 63 unit 1107 search and rescue Second Richards: page 63 is not included in the amendment, it is all special revenue. Amendment to the amendment passed by 8 to 4 MOTION PASSED 1/19/2016 10:10:05 AM Page 16 deep water ports unit 0103– Gov rec adopted Unit 1014 intergovernmental cooperation page 19 Wasserburger: move to delete fees for delegation attending. Burns: eliminate portion for membership in education commission Second MOTION PASSED Nicholas: eliminating the dues and the travel? Williams: Dues and registration are in one line item Gov Rec as amended adopted Unit 0101 page 24 Policy Office Gov rec Greear: page 22 reduction in salary – make series 100 reflect the actual salary of that reduction $245,588 Williams: page 22, reducing positions but at reduced salary amounts. Diversion of money to augment other positions. 311,036 original amount, difference is 245,588 from original to proposed. Greear: Reduce series 100 by additional sum Williams: Total would represent the original amount Second Greear: Clean up. Flexibility to the Governor. Motion adopted Ross: LSRA – Previous motion to change LSRA to GF BRA. Page 21 70145 dollars would now be GF dollars. Richards: Correct. 0106 Gov rec as amended. 1/19/2016 10:19:29 AM Break 1/19/2016 10:32:42 AM Reconsider motion, motion carried. Global motion to cut 900 Series by 5% in all agencies. Motion carried. Wasserburger: reconsider motion on unit 0104, passed. Motion to reduce by $75,000 for education commission of the states; seconded. Passed. Unit 0104, as amended, adopted. Motion to add footnote as described. Adopted. Unit 0107. Gov rec, adopted. Unit 0201, Tribal Liaison, gov rec. Nicholas motion to fund for 1 year, seconded. Discussion. Ross suggested 1 year appropriation motion for footnote, motion and seconded. Adopted. Burkhart: reduce 900 series, professional fees, by $20,000; seconded. Perkins: in addition to 5%? Burkhart: yes Motion adopted. Harshman motion that funds are one time only, adopted. Motion adopted. Unit 0301 Gov rec, adopted. Unit 0601, gov rec. Burkhart motion to deny exception request by $344,000, seconded. Motion adopted. Unit 0601, as amended, adopted. Unit 0901, gov rec. Adopted. Unit 1101, gov rec. Harshman: 2 positions. No general fund monies. Transfer to AG. Coordinating with school facilities Motion adopted. Unit 1102, gov rec. Adopted. Unit 1103, Flood Mitigation, gov rec. Adopted. Unit 1104, Hazardous materials, gov rec. Adopted. Unit 1105, Waste Isolation Plant, gov rec. Adopted. Unit 1106, Disaster Contingency, gov rec. Stubson motion to reduce exception request in half, seconded. Adopted. Gov rec, as amended, adopted. Unit 1107, Search and Rescue, gov rec. Adopted. Unit 1110, State Support Fund, gov rec. Adopted. Unit 1111, Public Safety Communications Commission, gov rec. Exception request. Part of salary federally funded from unit 1101. Gov rec. Passed. Unit 1112, Radiological Services. Gov rec. Adopted. Unit 1113, Pre-Disaster Mitigation, gov rec. Adopted. Unit 1114, Office for Domestic Preparedness, gov rec. Adopted. Unit 1115, Lifesaver Program. Harsham motion to cut to $75,000, one time monies; seconded. Adopted. Gov rec, as amended, adopted. Unit 2401, Natural Resource Policy Account, gov rec, adopted. Nicholas motion to reopen, reduce by $200,000, seconded. Failed. Gov rec, adopted. Unit 2601, Endangered Species Coordinator, gov rec, passed. Unit 2901, Baseline Scientific Assessment, gov rec., adopted. Richards: Page 37, request for footnote to carryover prior appropriation. Motion, seconded to approve, carried. Footnote Number 4, motion and second, adopted. Global motion to move all LSRA to general fund, all one-time funds. Hibbard: baseline assessment reduced additional 5%. Footnote Number 5, $1.2M Motion to close agency 001. All voted aye. 1/19/2016 11:31:39 AM Break 1/19/2016 11:38:24 AM Hibbard: governor’s policy office, cut funding and moved 2 positions. Basically, cut 4 positions. Page 21. Not associated with 900 series monies. Section 353 for agency to balance budget with existing monies prior to FY17-18 budget. Motion to reopen agency 001 by Greear, seconded. All voted aye. Unit 0106, Perkins motion for gov rec; seconded. Adopted. Perkins motion to close agency 001, seconded. All voted aye. 002, Secretary of State Unit 0101, Administration. Page 22, exception request, Perkins to deny and further reduce 0902 by $67,497, seconded. Amendment adopted. Motion adopted. Rec, as amended, adopted. Richards: page 21, footnote. Unit 0201, Rules Tracking Program, gov rec. adopted. Unit 0401, Securities Enforcement, gov rec. adopted. Unit 0602, Bucking Horse & Rider, gov rec. adopted. Motion to close agency 002, all voted aye. 003, State Auditor Unit 0101, Administration. Gov rec. adopted. Unit 0401, Brucellosis, carry over of funds request on page 21, gov rec. adopted. Unit 1001, GF License Revenue Recoupment, gov rec. adopted. Unit 2501, State Employee compensation insurance, gov rec. adopted. Motion to close agency 003, adopted. 1/19/2016 12:01:18 PM Lunch Break