A Briefing on Georgia’s Budget.  A presentation by Carolyn Bourdeaux to the Georgia Partnership for Excellence in Education on November 14, […

Bourdeaux, Carolyn

English

Georgia State University

A Briefing on Georgia’s
Budget

ScholarWorks @ Georgia State University

Georgia State University ScholarWorks @ Georgia State University CSLF Working Papers Center for State and Local Finance 11-14-2012 A Briefing on Georgia’s Budget Carolyn Bourdeaux Georgia State University Follow this and additional works at: https://scholarworks.gsu.edu/ays_cslf_workingpapers Recommended Citation Bourdeaux, Carolyn, "A Briefing on Georgia’s Budget" (2012). CSLF Working Papers. 47. https://scholarworks.gsu.edu/ays_cslf_workingpapers/47 This Article is brought to you for free and open access by the Center for State and Local Finance at ScholarWorks @ Georgia State University. It has been accepted for inclusion in CSLF Working Papers by an authorized administrator of ScholarWorks @ Georgia State University. For more information, please contact scholarworks@gsu.edu. A Briefing on Georgia’s BudgetCarolyn BourdeauxAssociate Director, Fiscal Research CenterAndrew Young School, GSUState Tax RevenuesPersonal Income50%General Sales and Use33%Corporate Income and License4%Motor Fuels6%Insurance Premium2%Other5%Data Sources: OPB Budget in Brief FY12-FY13, Bureau of Economic Analysis GDP DeflatorState Tax Revenues Per Capita (2012 Dollars)$1,447$1,776$2,233 $2,191$1,750$0$250$500$750$1,000$1,250$1,500$1,750$2,000$2,250$2,50019851986198719881989199019911992199319941995199619971998199920002001200220032004200520062007200820092010201120122013*20%Data Sources: Bureau of Economic Analysis, GDP DeflatorState Personal Income Per Capita(2012 Dollars)$36,793$38,462$36,800$20,000$22,000$24,000$26,000$28,000$30,000$32,000$34,000$36,000$38,000$40,000Data Sources: OPB Budget in Brief FY12-FY13, Bureau of Economic Analysis4.00%4.20%4.40%4.60%4.80%5.00%5.20%5.40%5.60%5.80%6.00%6.20%6.40%6.60%19841985198619871988198919901991199219931994199519961997199819992000200120022003200420052006200720082009201020112012$3.3 billionState Tax Revenues as % of Personal IncomeEducation39%Health19%Higher Education5%Public Safety9%Debt Service5%Transportation4%Human Resources3%Other16%State General Fund Expenditures$1,843 $1,633 $1,996 $2,215 $2,355 $2,294 $2,258  $2,252 $1,829 $1,100 $1,300 $1,500 $1,700 $1,900 $2,100 $2,300 $2,500199019911992199319941995199619971998199920002001200220032004200520062007200820092010201120122013GState Per Capita Appropriations (GDP)Source: Selected Summary Financial Information; Inflation Index Used:  Gross Domestic Product -NIPA Table 1.1.4Per Capita State Appropriations (State Funds, 2011 Dollars)2002 2008 2012 2013Change 2008‐2013% Change 2008‐2013% Change 2002‐2013Agriculture $6.60  $5.08  $2.99  $3.85  ($1.23) ‐24% ‐42%Debt Service on Bonds $106.93  $106.54  $91.58  $106.37  ($0.18) 0% ‐1%Health and Human Services $437.21  $450.73  $413.61  $415.50  ($35.23) ‐8% ‐5%Corrections $178.87  $162.95  $139.90  $139.61  ($23.33) ‐14% ‐22%Economic Development $18.61  $25.02  $8.02  $16.98  ($8.05) ‐32% ‐9%Education $909.10  $912.42  $723.50  $711.29  ($201.13) ‐22% ‐22%General Government $87.84  $88.82  $34.87  $37.16  ($51.65) ‐58% ‐58%Higher Education $356.47  $335.67  $258.55  $264.68  ($70.99) ‐21% ‐26%Judicial $19.32  $22.28  $19.74  $19.29  ($2.99) ‐13% 0%Natural Resources $28.71  $19.57  $11.72  $11.83  ($7.74) ‐40% ‐59%Public Safety $27.71  $24.87  $20.32  $21.53  ($3.35) ‐13% ‐22%Transportation $116.49  $98.24  $79.29  $80.73  ($17.51) ‐18% ‐31%TOTAL $        2,294  $        2,252  $        1,804   $        1,829  ($423.38) ‐19% ‐20%*Includes budget stabilization funds, FMAP and other enhanced Medicaid assistance. Per Capita Inflation Adjusted Growth by Policy Area  (Amounts in 2011 Dollars, Includes All State Funds and Budget Stabilization/FMAP*) $677$780$909 $912$711$200$300$400$500$600$700$800$900$1,0001990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013Per Capita Inflation Adjusted Education Funding Pre K‐12(All State Funds plus ARRA, 2011 Dollars)Per Capita Appropriations ‐ Inflation AdjustedSource: Selected Summary Financial Information; Inflation Index Used:  Gross Domestic Product -NIPA Table 1.1.4Education Funding Among Southern StatesNote: This following analysis draws on Census data and uses 2010 as the basis for inflationary adjustment.  Additionally, the analysis looks at per student or per “full time equivalent, FTE” so numbers will not match to previous slides which used population and 2011 for its inflationary adjustment. 050,000100,000150,000200,000250,0002000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010MillionsTotal Real Revenues for K-12 Education Southern States (2010 Dollars)28% Growth$4,543$4,619$4,590$4,555$4,502$4,587$4,674$4,856$5,079$4,993$4,687$3,442$3,574$3,691$3,723$3,856$3,943$4,174$4,346$4,289$4,390$4,208$741$783$875$936$1,006$1,052$1,157$1,091$1,055$1,114$1,5820.002.004.006.008.0010.0012.0014.0016.0018.0020.00$0$2,000$4,000$6,000$8,000$10,000$12,0002000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010Total Enrollment in MillionsReal Per FTE Revenues by Type for "Average" Southern State and Total Enrollments (2010 Dollars)State Revenue Local Revenue Federal Revenue SLC States EnrollmentReal Per FTE K12 Education Revenues for the Average Southern State (in 2010 Dollars)Trend Between 2000 and 2010 in Per Pupil RevenuesRevenue Level 2000 Share of Total 2010 Share of Total Percent ChangeLocal $3,442 39.44% $4,208 40.16% 22.26%State $4,543 52.06% $4,687 44.74% 3.17%Federal $741 8.50% $1,582 15.10% 113.38%Total $8,726 $10,477 20.06%Total Enrollment for SLC States (millions) 16.68 18.28 10%Calculations are from revenue figures provided by the US Census F-33 Financial Survey and represent a per state average amount over 15 SE States (AL,AR, FL, GA, KY, LA, MS, MO, NC, OK, SC, TN, TX, VA, and WV); Table uses national GDP price deflator to adjust for inflation.State Comparisons 2000-2010(in 2010 Dollars)Enroll-mentGrowthState Revenue Per FTE GrowthLocal Revenue Per FTE GrowthFederal Revenue Per FTE GrowthOverall Revenue  Per FTE GrowthOverall Revenue Per FTE 2000Rank in 2000Overall Revenue Per FTE 2010Rank in 2010Change in RankAlabama 3% -3% 24% 105% 15% 8,475 10 9,724 12 -2Arkansas 5% 55% -30% 132% 34% 7,994 12 10,677 9 3Florida 11% -33% 34% 115% 7% 9,355 4 9,986 11 -7Georgia 17% -16% 13% 147% 8% 9,967 1 10,745 6 -5Kentucky 5% 5% 26% 101% 21% 8,483 9 10,242 10 -1Louisiana -12% 27% 53% 149% 51% 8,073 11 12,191 1 10Mississippi -2% 12% 30% 106% 31% 6,958 15 9,086 13 2Missouri -2% 13% 0% 163% 15% 9,255 6 10,687 8 -2North-Carolina 13% -13% 97% 115% 27% 9,084 7 11,510 3 4Oklahoma 4% -7% 30% 54% 12% 7,891 13 8,843 14 -1South-Carolina 7% 3% 28% 113% 22% 8,909 8 10,840 5 3Tennessee 7% 16% 5% 75% 16% 7,453 14 8,654 15 -1Texas 19% -1% 12% 116% 15% 9,273 5 10,694 7 -2Virginia 10% 5% 22% 124% 20% 9,965 2 12,003 2 0West-Virginia -3% 0% 20% 99% 15% 9,764 3 11,275 4 -1Calculations from revenue figures provided by the US Census F-33 Financial Survey. Table uses national GDP price deflator to adjust for inflation.43% Growth$0$5,000$10,000$15,000$20,000$25,000$30,000$35,000$40,000$45,000$50,0002000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011MillionsTotal Real Revenues for Higher Education SLC States (2011 Dollars)$7,399$7,335$6,963$6,680$6,270$6,326$6,632$7,048$7,420$6,853$6,452$6,072$2,814$2,994$3,055$3,241$3,325$3,545$3,744$3,808$3,890$3,982$4,113$4,25700.511.522.533.544.55$0$2,000$4,000$6,000$8,000$10,000$12,0002000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011MillionsReal Per FTE Higher Education Revenues for the Average SLC State and Total Enrollment (2011 Dollars)State/Local Appropriations Net Tuition Revenue EnrollmentReal Per FTE Revenues for the Average SLC State (in 2011 Dollars)Trend Between 2000 and 2011Fund Source 2000 Share of Total 2011Share of TotalPercent ChangeState/Local Appropriations $7,399 72.45% $6,072 58.79% -17.94%Tuition $2,814 27.55% $4,257 41.21% 51.27%Total $10,213 $10,328 1.13%Total Enrollment in SLC States (millions) 2.99 4.33 45.07%Revenue figures are from State Higher Education Executive Officers Association, State Higher Education Finance Report.  Numbers are adjusted using a GDP Price Deflator to make them comparable to other budgetary numbers in this presentation.  The numbers represent a per state average amount over 15 SE States (AL,AR, FL, GA, KY, LA, MS, MO, NC, OK, SC, TN, TX, VA, and WV).Change in Real Revenues per Student 2000-2011State/ Local Appropriations per FTETuition Per FTEOverall Spending Per FTEStudent GrowthOverall Funding Per FTE 2000Rank in 2000Overall Funding Per FTE 2011Rank in 2011Change in RankAlabama -15% 64% 16% 28% $10,242 8 $11,906 1 7Arkansas -16% 99% 10% 44% $8,969 12 $9,890 10 2Florida -24% 14% -14% 60% $9,518 10 $8,149 15 -5Georgia -44% 2% -37% 123% $14,314 1 $9,077 14 -13Kentucky -25% 36% -6% 41% $12,321 2 $11,527 3 -1Louisiana 17% 29% 20% 8% $7,868 15 $9,438 13 2Mississippi -31% 52% -10% 36% $10,587 5 $9,502 12 -7Missouri -28% 72% -1% 17% $11,309 4 $11,197 5 -1North Carolina -4% 23% 1% 64% $11,320 3 $11,461 4 -1Oklahoma -13% 259% 21% 26% $8,265 14 $9,964 9 5South Carolina -27% 73% 9% 37% $9,232 11 $10,042 8 3Tennessee 4% 17% 9% 25% $9,691 9 $10,516 7 2Texas -2% 19% 5% 44% $10,270 7 $10,761 6 1Virginia -25% 80% 10% 38% $10,568 6 $11,655 2 4West Virginia -10% 49% 13% 29% $8,722 13 $9,839 11 2Outlook for Georgia’s FY13 Budget• Growth projections: revenue estimate based on 4.9% growth over FY12 (for Dept. of Revenue collected funds)– Currently YTD coming in at 4.8% over FY12– Growth of $789 million over FY12FY13 Demands• FY13 Shortfalls include:– $354 million in Medicaid and Peachcareshortfall from population growth and issues in underfunding• $170 million available for K-12 RSR Midyear AdjustmentFY14 Demands• Assume 5% growth over current: $843 million• Areas of Demand$336 million in Medicaid growth$235 million loss from Provider Fee$43 million for Behavioral Health for DOJ Settlement $65 million est. ERS increase to meet ARC$55 million TRS increase to meet ARC$734 million in required funds$100 million est. for K-12 growth$100 million est. for Higher Ed growthFuture ExpectationsThe theme of this next decade is going to be governmental retrenchment.In the near term:• Federal fiscal cliff will include 8% across the board cut for education programs.  Even if resolved, education is part of the domestic discretionary budget that is likely to be disproportionately cut.• State growth is likely to be consumed disproportionately by health expenses and will only be sufficient to cover basic growth needs and fill holes created during the recession.• OPB has asked agencies to develop 3% cut scenarios for FY13A and FY14• Local revenues will see several more years of pressure from declining property values.Era that is going to require new thinking about more effective/efficient ways to do business and perhaps new ways to raise revenues to support selected government services.

Georgia State University ScholarWorks @ Georgia State University CSLF Presentations Center for State and Local Finance 11-12-2012 A Briefing on Georgia’s Budget Carolyn Bourdeaux Georgia State University Follow this and additional works at: https://scholarworks.gsu.edu/ays_cslf_presentations Recommended Citation Bourdeaux, Carolyn, "A Briefing on Georgia’s Budget" (2012). CSLF Presentations. 34. https://scholarworks.gsu.edu/ays_cslf_presentations/34 This Article is brought to you for free and open access by the Center for State and Local Finance at ScholarWorks @ Georgia State University. It has been accepted for inclusion in CSLF Presentations by an authorized administrator of ScholarWorks @ Georgia State University. For more information, please contact scholarworks@gsu.edu. A Briefing on Georgia’s BudgetCarolyn BourdeauxAssociate Director, Fiscal Research CenterAndrew Young School, GSUState Tax RevenuesPersonal Income50%General Sales and Use33%Corporate Income and License4%Motor Fuels6%Insurance Premium2%Other5%Data Sources: OPB Budget in Brief FY12-FY13, Bureau of Economic Analysis GDP DeflatorState Tax Revenues Per Capita (2012 Dollars)$1,447$1,776$2,233 $2,191$1,750$0$250$500$750$1,000$1,250$1,500$1,750$2,000$2,250$2,50019851986198719881989199019911992199319941995199619971998199920002001200220032004200520062007200820092010201120122013*20%Data Sources: Bureau of Economic Analysis, GDP DeflatorState Personal Income Per Capita(2012 Dollars)$36,793$38,462$36,800$20,000$22,000$24,000$26,000$28,000$30,000$32,000$34,000$36,000$38,000$40,000Data Sources: OPB Budget in Brief FY12-FY13, Bureau of Economic Analysis4.00%4.20%4.40%4.60%4.80%5.00%5.20%5.40%5.60%5.80%6.00%6.20%6.40%6.60%19841985198619871988198919901991199219931994199519961997199819992000200120022003200420052006200720082009201020112012$3.3 billionState Tax Revenues as % of Personal IncomeEducation39%Health19%Higher Education5%Public Safety9%Debt Service5%Transportation4%Human Resources3%Other16%State General Fund Expenditures$1,843 $1,633 $1,996 $2,215 $2,355 $2,294 $2,258  $2,252 $1,829 $1,100 $1,300 $1,500 $1,700 $1,900 $2,100 $2,300 $2,500199019911992199319941995199619971998199920002001200220032004200520062007200820092010201120122013GState Per Capita Appropriations (GDP)Source: Selected Summary Financial Information; Inflation Index Used:  Gross Domestic Product -NIPA Table 1.1.4Per Capita State Appropriations (State Funds, 2011 Dollars)2002 2008 2012 2013Change 2008‐2013% Change 2008‐2013% Change 2002‐2013Agriculture $6.60  $5.08  $2.99  $3.85  ($1.23) ‐24% ‐42%Debt Service on Bonds $106.93  $106.54  $91.58  $106.37  ($0.18) 0% ‐1%Health and Human Services $437.21  $450.73  $413.61  $415.50  ($35.23) ‐8% ‐5%Corrections $178.87  $162.95  $139.90  $139.61  ($23.33) ‐14% ‐22%Economic Development $18.61  $25.02  $8.02  $16.98  ($8.05) ‐32% ‐9%Education $909.10  $912.42  $723.50  $711.29  ($201.13) ‐22% ‐22%General Government $87.84  $88.82  $34.87  $37.16  ($51.65) ‐58% ‐58%Higher Education $356.47  $335.67  $258.55  $264.68  ($70.99) ‐21% ‐26%Judicial $19.32  $22.28  $19.74  $19.29  ($2.99) ‐13% 0%Natural Resources $28.71  $19.57  $11.72  $11.83  ($7.74) ‐40% ‐59%Public Safety $27.71  $24.87  $20.32  $21.53  ($3.35) ‐13% ‐22%Transportation $116.49  $98.24  $79.29  $80.73  ($17.51) ‐18% ‐31%TOTAL $        2,294  $        2,252  $        1,804   $        1,829  ($423.38) ‐19% ‐20%*Includes budget stabilization funds, FMAP and other enhanced Medicaid assistance. Per Capita Inflation Adjusted Growth by Policy Area  (Amounts in 2011 Dollars, Includes All State Funds and Budget Stabilization/FMAP*) $677$780$909 $912$711$200$300$400$500$600$700$800$900$1,0001990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013Per Capita Inflation Adjusted Education Funding Pre K‐12(All State Funds plus ARRA, 2011 Dollars)Per Capita Appropriations ‐ Inflation AdjustedSource: Selected Summary Financial Information; Inflation Index Used:  Gross Domestic Product -NIPA Table 1.1.4Education Funding Among Southern StatesNote: This following analysis draws on Census data and uses 2010 as the basis for inflationary adjustment.  Additionally, the analysis looks at per student or per “full time equivalent, FTE” so numbers will not match to previous slides which used population and 2011 for its inflationary adjustment. 050,000100,000150,000200,000250,0002000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010MillionsTotal Real Revenues for K-12 Education Southern States (2010 Dollars)28% Growth$4,543$4,619$4,590$4,555$4,502$4,587$4,674$4,856$5,079$4,993$4,687$3,442$3,574$3,691$3,723$3,856$3,943$4,174$4,346$4,289$4,390$4,208$741$783$875$936$1,006$1,052$1,157$1,091$1,055$1,114$1,5820.002.004.006.008.0010.0012.0014.0016.0018.0020.00$0$2,000$4,000$6,000$8,000$10,000$12,0002000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010Total Enrollment in MillionsReal Per FTE Revenues by Type for "Average" Southern State and Total Enrollments (2010 Dollars)State Revenue Local Revenue Federal Revenue SLC States EnrollmentReal Per FTE K12 Education Revenues for the Average Southern State (in 2010 Dollars)Trend Between 2000 and 2010 in Per Pupil RevenuesRevenue Level 2000 Share of Total 2010 Share of Total Percent ChangeLocal $3,442 39.44% $4,208 40.16% 22.26%State $4,543 52.06% $4,687 44.74% 3.17%Federal $741 8.50% $1,582 15.10% 113.38%Total $8,726 $10,477 20.06%Total Enrollment for SLC States (millions) 16.68 18.28 10%Calculations are from revenue figures provided by the US Census F-33 Financial Survey and represent a per state average amount over 15 SE States (AL,AR, FL, GA, KY, LA, MS, MO, NC, OK, SC, TN, TX, VA, and WV); Table uses national GDP price deflator to adjust for inflation.State Comparisons 2000-2010(in 2010 Dollars)Enroll-mentGrowthState Revenue Per FTE GrowthLocal Revenue Per FTE GrowthFederal Revenue Per FTE GrowthOverall Revenue  Per FTE GrowthOverall Revenue Per FTE 2000Rank in 2000Overall Revenue Per FTE 2010Rank in 2010Change in RankAlabama 3% -3% 24% 105% 15% 8,475 10 9,724 12 -2Arkansas 5% 55% -30% 132% 34% 7,994 12 10,677 9 3Florida 11% -33% 34% 115% 7% 9,355 4 9,986 11 -7Georgia 17% -16% 13% 147% 8% 9,967 1 10,745 6 -5Kentucky 5% 5% 26% 101% 21% 8,483 9 10,242 10 -1Louisiana -12% 27% 53% 149% 51% 8,073 11 12,191 1 10Mississippi -2% 12% 30% 106% 31% 6,958 15 9,086 13 2Missouri -2% 13% 0% 163% 15% 9,255 6 10,687 8 -2North-Carolina 13% -13% 97% 115% 27% 9,084 7 11,510 3 4Oklahoma 4% -7% 30% 54% 12% 7,891 13 8,843 14 -1South-Carolina 7% 3% 28% 113% 22% 8,909 8 10,840 5 3Tennessee 7% 16% 5% 75% 16% 7,453 14 8,654 15 -1Texas 19% -1% 12% 116% 15% 9,273 5 10,694 7 -2Virginia 10% 5% 22% 124% 20% 9,965 2 12,003 2 0West-Virginia -3% 0% 20% 99% 15% 9,764 3 11,275 4 -1Calculations from revenue figures provided by the US Census F-33 Financial Survey. Table uses national GDP price deflator to adjust for inflation.43% Growth$0$5,000$10,000$15,000$20,000$25,000$30,000$35,000$40,000$45,000$50,0002000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011MillionsTotal Real Revenues for Higher Education SLC States (2011 Dollars)$7,399$7,335$6,963$6,680$6,270$6,326$6,632$7,048$7,420$6,853$6,452$6,072$2,814$2,994$3,055$3,241$3,325$3,545$3,744$3,808$3,890$3,982$4,113$4,25700.511.522.533.544.55$0$2,000$4,000$6,000$8,000$10,000$12,0002000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011MillionsReal Per FTE Higher Education Revenues for the Average SLC State and Total Enrollment (2011 Dollars)State/Local Appropriations Net Tuition Revenue EnrollmentReal Per FTE Revenues for the Average SLC State (in 2011 Dollars)Trend Between 2000 and 2011Fund Source 2000 Share of Total 2011Share of TotalPercent ChangeState/Local Appropriations $7,399 72.45% $6,072 58.79% -17.94%Tuition $2,814 27.55% $4,257 41.21% 51.27%Total $10,213 $10,328 1.13%Total Enrollment in SLC States (millions) 2.99 4.33 45.07%Revenue figures are from State Higher Education Executive Officers Association, State Higher Education Finance Report.  Numbers are adjusted using a GDP Price Deflator to make them comparable to other budgetary numbers in this presentation.  The numbers represent a per state average amount over 15 SE States (AL,AR, FL, GA, KY, LA, MS, MO, NC, OK, SC, TN, TX, VA, and WV).Change in Real Revenues per Student 2000-2011State/ Local Appropriations per FTETuition Per FTEOverall Spending Per FTEStudent GrowthOverall Funding Per FTE 2000Rank in 2000Overall Funding Per FTE 2011Rank in 2011Change in RankAlabama -15% 64% 16% 28% $10,242 8 $11,906 1 7Arkansas -16% 99% 10% 44% $8,969 12 $9,890 10 2Florida -24% 14% -14% 60% $9,518 10 $8,149 15 -5Georgia -44% 2% -37% 123% $14,314 1 $9,077 14 -13Kentucky -25% 36% -6% 41% $12,321 2 $11,527 3 -1Louisiana 17% 29% 20% 8% $7,868 15 $9,438 13 2Mississippi -31% 52% -10% 36% $10,587 5 $9,502 12 -7Missouri -28% 72% -1% 17% $11,309 4 $11,197 5 -1North Carolina -4% 23% 1% 64% $11,320 3 $11,461 4 -1Oklahoma -13% 259% 21% 26% $8,265 14 $9,964 9 5South Carolina -27% 73% 9% 37% $9,232 11 $10,042 8 3Tennessee 4% 17% 9% 25% $9,691 9 $10,516 7 2Texas -2% 19% 5% 44% $10,270 7 $10,761 6 1Virginia -25% 80% 10% 38% $10,568 6 $11,655 2 4West Virginia -10% 49% 13% 29% $8,722 13 $9,839 11 2Outlook for Georgia’s FY13 Budget• Growth projections: revenue estimate based on 4.9% growth over FY12 (for Dept. of Revenue collected funds)– Currently YTD coming in at 4.8% over FY12– Growth of $789 million over FY12FY13 Demands• FY13 Shortfalls include:– $354 million in Medicaid and Peachcareshortfall from population growth and issues in underfunding• $170 million available for K-12 RSR Midyear AdjustmentFY14 Demands• Assume 5% growth over current: $843 million• Areas of Demand$336 million in Medicaid growth$235 million loss from Provider Fee$43 million for Behavioral Health for DOJ Settlement $65 million est. ERS increase to meet ARC$55 million TRS increase to meet ARC$734 million in required funds$100 million est. for K-12 growth$100 million est. for Higher Ed growthFuture ExpectationsThe theme of this next decade is going to be governmental retrenchment.In the near term:• Federal fiscal cliff will include 8% across the board cut for education programs.  Even if resolved, education is part of the domestic discretionary budget that is likely to be disproportionately cut.• State growth is likely to be consumed disproportionately by health expenses and will only be sufficient to cover basic growth needs and fill holes created during the recession.• OPB has asked agencies to develop 3% cut scenarios for FY13A and FY14• Local revenues will see several more years of pressure from declining property values.Era that is going to require new thinking about more effective/efficient ways to do business and perhaps new ways to raise revenues to support selected government services.

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