Governors Release Fiscal 2019 Budget Proposals

By Brian Sigritz posted 01-12-2018 02:06 PM


Governors Release Fiscal 2019 Budget Proposals

As of February 14, 37 governors have released a new or revised budget proposal for fiscal 2019, which will begin on July 1, 2018 for 46 states (New York begins its fiscal year on April 1, Texas on September 1, and Alabama and Michigan on October 1). Over the coming months, 33 states will enact a new budget for fiscal 2019, including three states that will authorize a two-year budget covering both fiscal 2019 and fiscal 2020. Seventeen states previously enacted budgets covering both fiscal 2018 and fiscal 2019, some of whom will consider a revised (or supplemental) budget this year. 

Governors are proposing fiscal 2019 budgets during a period of moderate improvement in revenue collections combined with rising spending demands. Most states are forecasting modest gains in their general fund revenue collections in fiscal 2018 according to NASBO’s Fall Fiscal Survey of States, with total general fund revenue growth of 4.0 percent and a median growth rate of 3.2 percent. However, even with a slight uptick in revenue collections, states continue to contend with rising spending pressures in areas such as education, health care, and transportation, while at the same time focusing on addressing long-term obligations such as funding pensions, building up reserves, and promoting structural balance. Additionally, states are closely monitoring developments at the federal level including finalizing federal fiscal year 2018 funding, the reauthorization of the Children’s Health Insurance Program (CHIP), efforts to stabilize or repeal the Affordable Care Act, and the consideration of various infrastructure proposals, while at the same time trying to determine the impact to their state from the recent passage of the Tax Cut and Jobs Act (as discussed in a recent NASBO blog).

To date, most budget proposals for fiscal 2019 have called for another year of slow spending growth, with a few governors proposing declines in general fund spending. As has been the case most years since the last recession, many governors are targeting the largest amount of new spending to elementary and secondary education. Other areas of emphasis have included tackling the opioid crisis, addressing mental health demands, added funding for public safety, meeting infrastructure needs, new programs to promote job training and workforce development, pension reform, and efforts to maintain fiscal sustainability. Finally, a number of governors have released tax reform proposals in hopes of spurring additional economic growth.

Please click here to access governors’ budget proposals for fiscal 2019, and prior enacted budgets. Additionally, in February, NASBO will release state-by-state analyses of State of the State speeches, while in March, NASBO will publish state-by-state summaries of fiscal 2019 proposed budgets.