Friday, December 11, 2009

Governor Herbert's Budget Recommenations

Governor Gary Herbert presented his budget recommendations today, Friday, December 11, 2009. UPEA is grateful for the governor’s emphasis on temporary measures to fix the current shortfall in the FY2010 budget. Based, in part, upon UPEA’s efforts, the governor recognizes that preserving jobs is a high priority.

Utah Public Employees’ Association has had regular meetings with Governor Herbert and the Office of Planning and Budget to discuss the impacts of the state’s fiscal projections. Additionally, UPEA Employee Representatives have met with agency heads to discuss the impacts of projected cuts.

As Governor Herbert released his budget proposal for FY2011 today, he took some swift action to plug some holes in the FY2010 budget through an executive order. Due to a very large revenue gap, Herbert is asking all agencies to cut “personal services” by 3% for the remaining 6 months in the fiscal year. The agencies will be given the discretion on how to make the cuts.

UPEA’s efforts will continue now that the governor has issued an Executive Order requiring agencies to reduce their discretionary budgets and enact the 3% cut. The governor encouraged department heads to find creative means for fixing the budget until June 30, 2010. UPEA will be working with directors and agency staff to ensure they are balancing fiscal needs while protecting public employee livelihoods.

Herbert’s budget recommendation includes appropriations to cover the 2% retirement contribution rate increase; and an appropriation to meet employees halfway with the $23 million PEHP health care increase. Based on the governor’s proposal, employees would only be responsible for 6% of the proposed 12% premium increase, which could result in a 90/10 employer-employee premium split. This is a good starting point for negotiations during the legislative session.

Subsequent to the end of FY2010, the Governor’s Office of Planning and Budget anticipates a strong recovery for the State Utah. The state will see $34 million in net growth for FY 2011.