MONTGOMERY - An Alabama Senate leader said Thursday that the state’s general fund budget, which supports most non-education agencies and departments, could be short “a couple hundred million” dollars in fiscal 2014.
Senate President Pro Tem Del Marsh, R-Anniston, said the result could be a mixture of flat funding, meaning no increase in appropriations, and cuts for some agencies for the budget year beginning Oct. 1.
This year’s general fund budget is about $1.7 billion.
Sen. Arthur Orr, R-Decatur, chairman of the Senate committee that oversees the general fund, said projected state revenues for 2014, including about $145 million transferred from the Alabama Trust Fund during the next three years, are level, demands on the general fund are not.
“We’re going to have the same amount of money, including the transfer,” Orr said. “The problem becomes, how much additional money does Medicaid need? How much does the Department of Corrections need?”
And how much do other expenses increase?
The Retirement Systems of Alabama estimates it will need $27 million more in fiscal 2014 to cover retiree pensions paid for by the General Fund. Meanwhile, the cost to provide insurance to state employees is expected to increase in 2014 by about $71 million, of which state agencies will likely pay at least a significant portion.
That could be a significant blow to a department like corrections, which has a lot of employees and is almost totally supported by the general fund.
“For those agencies, level funding will still mean they have to make cuts to absorb these employee costs,” Orr said.
About the state Education Trust Fund that supports public schools, Marsh said it was in “decent shape” for 2014.
The Alabama Legislature will begin discussing the 2014 budgets when its annual session begins next week.
Democratic Sen. Roger Bedford, of Russellville, said it still is early in the budget process and added lawmakers need to hear more about expected revenue for 2014 and agencies’ budget requests.
“I haven’t seen any numbers that lead me to believe that (cuts of several hundred million) would be warranted,” Bedford said.
Mary Sell can be reached at mary.sell@TimesDaily.com.