Budget Blog

2017 Annual Meeting Presentations

By John Hicks posted 07-26-2017 12:11 PM

  

IN_2017_Logo_2.pngNASBO held its 2017 Annual Meeting in Indianapolis, Indiana on July 16-19. Budget officers from 40 states and territories heard directly from leading experts on timely issues regarding the national economic outlook, the federal budget, Medicaid, state credit ratings, transportation funding, tax reform, pensions, and community colleges. Budget officers and other state officials also shared insights with their colleagues on topics of great interest including investing in rural broadband, building data analytic capacity, and other emerging issues, and had a chance to hear an update on FirstNet implementation. Below is a summary of the presentations made during the meeting. 

 

National Economic Outlook

Rick Mattoon, Senior Economist at the Federal Reserve Bank of Chicago, highlighted economic trends, future growth forecasts, and federal fiscal policy. Specifically, Mr. Mattoon discussed reasons for the muted economic growth, why the state and local government sector has been slower to recover, and the potential impact of possible changes at the federal level including in the areas of tax cuts, infrastructure, and defense spending.  Additionally, Mr. Mattoon talked about changes in states’ revenue performance and challenges facing pension systems.

 

Federal Budget Update

Marcia Howard, Executive Director of Federal Funds Information for States, provided an update on federal funding impacting states, action on health care reform legislation, status of federal appropriations, the deadline to raise the debt ceiling, and the upcoming expiration of several programs that affect state budgets, such as the Children’s Health Insurance Program.

 

The Current Status of Medicaid & Health Care
Robin Rudowitz, Associate Director for the Program on Medicaid and the Uninsured, Henry J. Kaiser Family Foundation, and Tom Betlach, Director of the Arizona Health Care Cost Containment System, provided an overview on proposed federal health care legislation that would reduce federal funding for Medicaid including the implications of capping the Medicaid program under current House and Senate bills. The session also covered other trends in the Medicaid program including waivers, delivery of long term care services, integration of behavioral and physical health, and managed care trends.

 

Expanding Broadband Access: State Initiatives

Sandra Beattie, Deputy Director, New York Division of the Budget, gave an overview of New York’s efforts to expand broadband access statewide and highlighted program requirements, geographic priorities, funding sources and private sector partnerships to achieve the goal of 100 percent high-speed internet access by 2018. David Thurman, Budget Director, Tennessee Department of Finance and Administration, highlighted the Tennessee Broadband Accountability Act, which aims to expand broadband access throughout the state through investment, deregulation and education efforts.

 

State Credit Ratings

Nick Samuels, Vice President/Senior Credit Officer from Moody’s Investors Service Public Finance Group, touched on many topics including state credit, Medicaid, pensions, transportation, and local government. Mr. Samuels said that while the credit strength of state government remains strong in comparison to other sectors, there have been more downgrades than upgrades over the past year. Mr. Samuels also highlighted the large role Medicaid plays in state budgets, discussed that states vary in their exposure to federal policy changes, and said that states have begun to take actions to address transportation needs.

 

State Efforts to Increase Transportation Funding

Carol Spain, Director/Lead Analyst for Standard and Poor’s Global Ratings State Governments Sector, talked about the transportation funding gap, state efforts to increase transportation investment, and the future of federal transportation funding. Ms. Spain noted that states have taken numerous steps to increase transportation funding including increasing motor fuel taxes, imposing fees on alternative vehicles, raising vehicle registration fees, dedicating broad based sales taxes, expanding the use of tolls, and exploring P3s. Ms. Spain also discussed different views on what is considered adequate transportation funding.

 

FirstNet: An Update for State Budget Offices

Andrew Delaney, Government Affairs Specialist, FirstNet, provided an update to budget officers on implementation of the interoperable first responder broadband network (FirstNet) and highlighted information currently being reviewed in states regarding deployment of the system. States received initial plans in June and are providing feedback to FirstNet in anticipation of final plans being released this fall.



Federal Tax Policy Changes – Impact on States

Harley Duncan, former Executive Director of the Federation of Tax Administrators, talked about the state implications of federal tax reform. Specifically, Mr. Duncan discussed how the U.S. income tax system is in some ways out of step with other countries, where things currently stand with the varying federal tax reform proposals, and how state and federal income taxes interact. Additionally, Mr. Duncan highlighted potential challenges and risks to states from federal tax policy changes, and that the timing of any changes will be a factor in the degree of impact to states.

 

Public Retirement Systems: Update on Recent Trends

Keith Brainard, Research Director of the National Association of State Retirement Administrators, detailed recent trends in public pension plans and funding. Mr. Brainard highlighted the continued shift of risk from employers to employees, changes in factors requiring higher contributions, including structurally lower government payrolls, decisions to lower the rate of investment returns, and improving mortality. Mr. Brainard also described different methods states are using to amortize unfunded liabilities, such as contributing more than the actuarially determined contributions. Updates were provided on recent governance changes among retirement systems and legal rulings on pension issues across the country.

 

Emerging Issues Roundtable

This session provided state attendees an opportunity to discuss emerging issues in a roundtable discussion format. Attendees had the opportunity to share ideas with colleagues on a range of issues including innovations in state budgeting, recruitment and retention of budget office employees, innovative ways to finance transportation, how states are financing Medicaid expansion, changes in higher education financing, and legislative and executive relationships.

 

Building Statewide Capacity for Data Analytics

Doug Robinson, Executive Director of the National Association of State Chief Information Officers (NASCIO), discussed the strategic importance of data management and analytics in state government and opportunities to use data to improve business processes and inform policymaking.  Indiana’s first Chief Data Officer, Darshan Shah, and Chief Information Officer, Dewand Neely, then shared how Indiana’s Management and Performance Hub, an advanced data analytics management system, is empowering state agencies to leverage performance data to make more informed policy decisions.

 

Investing in Two-Year Colleges to Build the Workforce

Neal Holly, Assistant Director of the Postsecondary and Workforce Development Institute at the Education Commission of the States, outlined the benefits of investing in community colleges, the need to support adult students, and actions states have taken to align their postsecondary education programs with workforce needs. Mr. Holly discussed the growing attention on post-graduation outcomes and impact of federal policy changes under the Workforce Innovation and Opportunity Act as well. Members from Kentucky and Indiana also shared more details on recent efforts their states have taken to support students pursuing postsecondary credentials in high-demand fields.