Y’all Politics has learned that the special session called by Mississippi Governor Phil Bryant for next Monday, June 5 will have three distinct legislative components.
As has been released in recent weeks, there are ongoing concerns about Mississippi’s credit rating. So much of those ratings are based on technical criteria. In addition to just the pure numbers, rating agencies like to see financial controls and commitments in places that are “checking the box” . . . you either have the box checked or you don’t. The FORTIFY ACT (Financial & Operational Responses That Invigorate Future Years) is a new piece of legislation meant to deal with lingering technical deficiencies. It does five things:
1. Requires by statue a multi-year budget plan from the Legislative Budget Office (LBO). Currently, LBO does engage in multi-year budgeting, but it’s not required to do so by statute.
2. Increases the Rainy Day Fund cap from 7.5% of current year appropriations to 10%. This is something that other states are doing in response to volatile revenue trends and it’s something that is increasing favor with rating agencies.
3. Revises the distribution of unencumbered cash so that more funds will go into savings and the Capital Expense Fund instead of flowing through to the next fiscal year.
4. Eliminates the Budget Contingency Fund. This is generally used by the Legislature as a vehicle to wash one time money (things like the BP settlement) into a fund that can make it look like part of recurring revenue.
5. A prohibition to use unencumbered current year cash as part of future revenue estimates
TECHNICAL CHANGES TO BUDGET TRANSPARENCY & SIMPLIFICATION ACT
This includes several technical amendments to the 2016 legislation that reformed how the state manages special budget funds, and will allow state agencies to spend federal funds more efficiently. This will entail clarifying some of the bill’s language with regard to trust fund accounts and allow for federal funds to be spent on utilities and technology, where appropriate.
FINISHING UNFINISHED APPROPRIATIONS
There are three appropriations bills that did not get final agreement . . . MDOT, State Aid Roads, and last but certainly not least the Attorney General. The transportation crowd, who at one point were advocating for an increase in gas tax and/or a lottery to fund roads, has been relatively quiet in recent weeks (to their credit), but Attorney General Jim Hood has gone on a barnstorming publicity tour comparing those legislators who he thinks are responsible for not approving his full budget as having the same mentality as those who said “Crucify Jesus” (bless his heart). Despite the hysteria, the smart money says that the appropriations part of the bill will be the least controversial. The baseline will likely be the conference reports from the session that did not get adopted, and there seems to be general agreement that this part of the session will find agreement pretty quickly.
Governor Bryant and his team have been pretty careful about special sessions. So the safe bet is that there is the framework of a deal with leadership even if the last little bits of language may not be 100% hashed out. For the two technical bills, these are technical changes that Republicans and those fans of good financial practices would have a hard time arguing with philosophically. The language of those bills is obviously subject to the legislative process.
Of course, anything can happen in a special session, particularly on appropriations bills. As long as the legislation is germane to the call, it could be open season. But there seems to be no possibility for a lottery or anything else to find real traction. The leverage that leadership has over members (and each other) is that a not-so-silent clock is ticking.
The message is clear. Gavel in. Pass bills. Get gone.