Budget Conference Highlights February 23, 2013 1 Resolution: - PowerPoint PPT Presentation

HB 1500 Budget Conference Highlights February 23, 2013 1

Resolution: Major Differences Area of House Senate Conference Government Public Salary Increases : Fund 11 Salary Increases : Fund 12 Salary Increases : $70.2 months for teachers ($53.5 months for teachers million for 11 months of Education m.), 6 months for support ($58.5 m.) and support 2% salary for teachers pers. ($9.1 m.) personnel ($18.2 m.) and support positions COCA : $6.1 million COCA : $12.6 million COCA : $9.4 million Strategic Compensation : Strategic Compensation : Strategic Compensation : $7.5 m. $3.0 m. $5.5 m. Compensation $30.4 m. for salary $38.7 for salary Chapter 3 provided a 2% adjustments – includes adjustments increase for all groups in compression component - FY 2014. $50 per year service for $3.8 m. add’l for Increases in HB 1500 state employees adjustments for specific include: employee groups State Employee: House compression concept at $65/year service ($70/year for state troopers) 2 Faculty, Judges and State- support locals at additional 1%

Resolution: Major Differences Area of House Senate Conference Government Reforms existing Mandates Medicaid Reforms existing Medicaid Health and Medicaid program. expansion concurrent with program. Expansion Human Expansion contingent program reforms, no GA contingent upon reform Resources upon fed’l and GA approval required, no and approval by legislative reform approval, Escape escape clause Medicaid Innovation and clause included Reform Commission Disability Services : $7.7 Disability Services : $7.7 m Disability Services : $7.7 m m for 200 ID waiver for 200 ID waiver slots and for 200 ID waiver slots and slots and 50 DD waiver 50 DD waiver slots, $5.1 m. 50 DD waiver slots, $5.1 m. slots, $5.1 m. for ID for ID crisis services, $3.8 for ID crisis services, $3.8 crisis services, $3.8 m. m. for increase waiver rates m. for increase waiver rates for increase waiver rates for individuals with for individuals with for individuals with exceptional needs exceptional needs exceptional needs Provider rates : $5.5 m. for Provider Rates : $4.3 m. for Provider rates : 10% private duty nursing, 5% private duty nursing, $300,000 for $5/day day $10/day for adult day $10/day for adult day increase for adult day health care, 5% Aux Grants health care, 3% Aux Grants health care Part C Services : $3.0 Part C Services : $8.3 m. Behavioral Health : $2.5 million Behavioral Health : $900k m. for suicide Behavioral Health : $750k children’s crisis services, 3 prevention and mental for discharge assistance, $900k therapeutic drop-off health first aid, $450k $1.0 m. for children’s crisis centers, $600k mental for children’s crisis services health first aid, $500k services suicide prevention

Resolution: Major Differences Area of House Senate Conference Government Higher Increased general Increased funding for Provides $3.4 million Education operating support financial aid for add’l slots at UVA, Va Tech, WM, and JMU Funded add’l slots at UVA, Va Tech, WM, and Provided $8.6 increased JMU funding for financial aid House research funding of $4.0 million Commerce and Used $2.55 m. from AG Used $1.5 million for $2.0 million for Housing Settlement for Housing housing programs Trust Fund and other Trade housing programs Used $5.1 million GOF for Captured $10.0 m. GOF Captures $7.5 million Fort Monroe balances GOF balances Increased cap on Angel Increased cap on Angel Investor Tax Credit Investor Tax Credit 4 Provided $1.5 m. for Provides $1.0 million for offshore wind energy offshore wind energy

Resolution: Major Differences Area of House Senate Conference Government Provided $216.0 million Provided $219.0 million for Provides $221 for natural Natural for bond projects bond projects resources bond projects Resources Public Safety Opened Grayson Prison No action beyond Opened Grayson Prison October 2013 vs. introduced budget October 2013 vs. January January 2014 2014 $1.3 million for school $1.0 million for school $1.3 million for school resource officers resource officers resource officers General Additional Rainy Day No RDF beyond introduced Additional Rainy Day Fund fund pre-deposit of budget. Created new reserve of $45.0 million Government $49.0 million Financial Flexibility Reserve Fund with $36.0 million Provided $2.5 million for Provided $1.0 million for Provides $2.5 million for Technology cyber-security accelerator cyber-security accelerator accelerator 5

Revenue Changes HB 1500 Conference Report ADDITIONS TO BALANCES Balances from Natural Disaster Setaside 12,037,553 Legislative Balances 1,625,771 Revert DSS - Auxiliary Grant Balances 500,000 Revert Indigent Care Commission Balances 238,000 Department of Social Services SSBG Balances 2,371,057 Revert Judicial Balances 3,012,372 ADDITIONS TO REVENUES Reflect Update to Federal Conformity 14,245,000 Revised Calculation of Sales Tax Shifted to TTF (900,000) Reflect HB 2155/SB 780 (Open Enrollment Requirement) 7,000,000 Increase Cap Qualified Equity and Subordinated Debt Credit (500,000) Reflect HB 2059 (Tax Credit for Participating Landlords) 200,000 CHANGES TO TRANSFERS Reflect Mortgage Servicing Settlement/AG Fund Balances 6,800,000 Retain MSA Arbitration Prevention Portion 3,937,000 Capture GOF Balances 7,500,000 ABC Profits Reforecast 5,846,260 6 Transfer VASAP balances 600,000 Department of Health Community Health Services balances 175,000 Total Changes: Revenues/Resources $64,688,013 Final Unappropriated Balance After Resource and Spending Adj. $10,042,864

Public Education 7

2% Salary Incentives , COCA and Strategic Compensation Grants  Teachers and Support Salary Incentive : Provides $70.2 million (11 months) for the state’s share • Optional participation & requires a local match – must provide at least a 2% increase by January 1, 2014, & would be eligible for the 11 months of funding from the state • Added revenue contingency language • Includes language that school divisions cannot count the phase-in of the VRS swap as its local match  COCA supplement for Support Positions : Provides $9.4 million in the second year  All full school divisions at 7.0%  All partial school divisions at 1.8%  Strategic Compensation Grants : Provides $5.5 million in second year 8

Other K-12 Initiatives in FY 2014  School Security : Establishes a five-year $30.0 million revolving Security Equipment Fund that would provide annual competitive grants up to $100,000 per division • Provides $6.0 million each year to enhance school security and would require a 25% local match • Funded through the Literary Fund  Supplants $6.1 million GF in VRS costs with Literary Fund from revenue generated by allowing an add-on for costs of outside collection agency  Eliminates language for a prospective funding methodology for school nurses for the 2014-16 rebenchmarking cycle  Includes language that expands eligibility for the STEM Teacher Recruitment & Retention Bonus to include middle 9 school grades & 2 nd & 3 rd year experienced teachers

Other K-12 Initiatives in FY 2014  School Division Consolidation Issues • Changes the consolidation agreement policy by requiring DOE to use a blended local composite index (LCI) instead of the lower LCI of the two divisions beginning in FY 2014 • Changes the period of time that DOE would use the new blended LCI after a consolidation from 15 years to a range between 5 & 15 years • Adds language directing JLARC to analyze the costs of incentives for consolidation and identify possible savings by October 1, 2014 • Requires Bedford to undergo a School Efficiency  Any school division that is participating in an existing consolidation is exempt from these policy changes 10

Other K-12 Initiatives in FY 2014  Virginia Teaching Scholarship Loan Program : Adds $708,000 in the second year • Increases the tuition amount from $3,720 to $10,000 • Adds eligibility to top 10% of high school class  Year-Round Schools : Provides $412,500 for planning grants up to $50,000 to divisions interested in submitting application to DOE for new year-round programs • Nine existing year-round programs can apply for any balances • Includes language for voluntary survey to school division superintendents to determine levels of statewide interest  Adds $129,500 for a new STEM learning initiative for Pre-K & kindergarten students  Opportunity Educational Institution : provides $150,000 in FY 2014 to pay first year start-up costs related to operating board • Also adds language to define the framework for the Institution and its general operations 11  Virginia Longitudinal Data System : provides $120,000 the second year for additional VITA related costs

Compensation and Retirement 12

Employee Compensation Adjustments Compared to Introduced Budget ($ in millions) Conference State Employees $24.7 University Faculty $7.3 State Supported Local $8.3 Total $40.3  Conference Report includes a 2% raise for state employees plus a compression adjustment of $65 per year of service • Employees must have at least 5 years of service to receive compression adjustment and it is capped at 30 years • Compression add-on $70 per year of service for State Police  Provides a 3% salary increase for faculty and state supported local  Effective date: 13 • State employees and faculty – July 25, 2013 • State supported local – August 1, 2013