Fiscal notes are brief descriptions
of the effect of a bill or amendment on the finances of Maine State
Government. They are prepared by the
Office of Fiscal and Program Review (OFPR), a non-partisan staff office of the
Legislature. For original printed bills,
preliminary fiscal impact statements, or in limited circumstances fiscal notes,
are distributed as separate documents from OFPR to the bill’s sponsor and the
committee of reference. Fiscal notes for
committee amendments and floor amendments are distributed with the printed
amendments as required by the Legislature’s Joint Rules. Fiscal notes are intended to accurately and
objectively describe the fiscal impact of bills and amendments so that the
Legislature can make informed decisions with respect to state and local
government finances.
The Legislature added fiscal notes
to its Joint Rules for the 103rd Legislature beginning in 1966. It decided that the information contained in
fiscal notes describing the impact of a bill on the finances of state
government was very important and should be available to guide them in their
deliberations. OFPR and its predecessor,
the Legislative Finance Office, have been responsible for developing objective
assessments of the fiscal impact of legislation and providing non-partisan
fiscal information to the Legislature. Certain
budget and financial restrictions on the operation of state government also
make it very important to track all legislation with a fiscal impact on state
government.
Fiscal Information for Legislators
The primary function of a fiscal
note is to inform Legislators of a piece of legislation’s financial impact on
State Government (i.e. the costs, savings and/or revenue increases or
decreases) and the costs incurred by local units of government. This information has become an important part
of the debate on bills and amendments, particularly as the State weathered some
tight fiscal years. In some cases, the
fiscal impact of a bill or amendment is obvious and straightforward. A bill may simply represent an appropriation
of funds to an agency for a specific purpose.
However, even these simple bills may have fiscal impacts beyond the
specific dollar amount appropriated in a given fiscal year. The appropriation may represent only partial
funding for a new program, it may represent the state matching requirement for
federal funds or it may have a revenue impact associated with the appropriation
of those funds. Fiscal notes provide
that information to Legislators so they can better understand the fiscal impact
of a bill or amendment when making decisions.
Balanced Budget Requirements
Article IX, Section 14 of the
Constitution of Maine prohibits the State from incurring debt above $2 million
(except for some very specific reasons related to insurrection, invasion or
war, etc.) without submitting the proposed obligation to referendum. Maine Revised Statutes Title 5, Section 1664
also requires the Governor to submit budget proposals that “..... show the
balanced relations between the total proposed expenditures and the total
anticipated revenues....” Finally, Maine Revised Statutes Title 5, Section 1668
authorizes the Governor to “temporarily curtail allotments equitably so that
expenditures will not exceed the anticipated income and other available
funds.” Only temporary borrowing for
cash flow purposes within a fiscal year is authorized. These provisions effectively create a
requirement for a balanced budget, particularly for the General Fund and
Highway Fund.
Fiscal notes play an important role
in this approach to state government budgeting.
Bills and amendments which include costs or savings (including revenue
effects) to state government are identified as they go through the legislative
process. Fiscal Notes combined with
certain tracking/tabling procedures allow the Legislature to coordinate the
fiscal impact of individual bills with the budgetary process and maintain a
balanced budget.
Special Appropriations Table,
The Legislature has established
procedures for tracking and making sure bills that affect the General Fund or
the Highway Fund are coordinated with the overall budget decisions for these
funds, given the balanced budget constraints.
Key components of these procedures are the Special Appropriations Table
and the Special Highway Table. These
tables set aside bills affecting the General Fund and the Highway Fund and
defer decisions on these bills until the end of a Legislative session after
decisions on the budget bills have been made.
Depending on the available resources, bills are often amended off the
“table” to reduce or eliminate costs or are recommended Ought Not to Pass
(ONTP) by the Appropriations Committee, Transportation Committee, and, on
occasion, Legislative Leadership.
Appendix A provides a description of these tables, their roles in the
budget processes and the types of bills that are tabled. Fiscal notes describing the impact of bills
on all funds play an important role in identifying which bills should be placed
on either the Special Appropriations Table or the Special Highway Table.
It is important to note that bills
affecting the General Fund and the Highway Fund are placed on these tables just
prior to final enactment of the bill.
Individuals following a particular bill should be aware of its fiscal
impact and the potential for it to be placed on one of these tables. Many legislators and interested members of
the public have been disappointed to find that a bill which may have been
reported unanimously out of committee and sailed easily through both houses was
placed on one of these tables only to die at the close of a legislative session
because the decision was made not to “fund” the bill. Therefore, the Office of Fiscal and Program
Review urges those interested in a particular bill to understand its fiscal
impact and whether that impact will place it on one of these tables.
In addition to the Special
Appropriations Table and the Special Highway Table, the Legislature added the
Special Study Table to its Joint Rules beginning with the 119th Legislature,
based on the recommendation by the Special Committee on Legislative Rules that
a formal study table be established on which all legislative study requests be placed. Unlike the Special Appropriations and Special
Highway Table, bills proposing to establish studies may be placed on the
Special Study Table in either the House or the Senate. The Legislative Council reviews all study
bills, including Joint Orders, and sets priorities for allocation of budgetary
and staff resources.
Other Budget Requirements
The fiscal note process of
identifying the fiscal impact of legislation, while most important for bills
affecting the General Fund and Highway Fund, is also important for the proper
implementation of bills affecting other funds such as dedicated revenue
accounts and federal expenditures fund accounts. Title 5, Chapters 145 and 149 set out some of
the limitations for expenditures from these other funds. These types of accounts may not incur
expenditures unless sufficient cash is available within the account or
fund. An additional restriction requires
legislative allocation of funds before the Bureau of the Budget may authorize
allotments and expenditures. Allotments
and expenditures may be authorized in excess of the legislative allocation in
certain circumstances, but if no base allocation exists for the program,
expenditures may not be made.
Joint Rule 312 of the 124th Legislature
provides the authorization for fiscal notes.
It states as follows:
“Rule 312. Fiscal Notes. Every bill or resolve that affects state
revenues, appropriations or allocations or that requires a local unit of
government to expand or modify that unit’s activities so as to necessitate
additional expenditures from local revenues and that has a committee
recommendation other than “Leave to Withdraw,” “Ought Not to Pass” or “Referral
to Another Committee” must include a fiscal note. For a bill or resolve not yet reported out
and upon request of a majority of the committee, the Office of Fiscal and
Program Review shall meet with the committee at a work session to present its
analysis and provide copies of the written materials relied upon by the office
to prepare that fiscal note. The
committee clerk shall provide the sponsor of the bill or resolve with prior
notification of the work session. The
committee clerk shall provide the Office of Fiscal and Program Review with a
copy of all testimony and other materials received by committee on the bill or
resolve whenever the committee recommendation is other than “Leave to
Withdraw,” unanimous “Ought Not to Pass” or unanimous “Referral to Another
Committee.” The fiscal note must accompany
the committee report as it is reported out of committee. Any subsequent amendment introduced that
would affect the fiscal impact of the original bill must also include a fiscal
note. The Office of Fiscal and Program
Review has the sole responsibility for preparing all fiscal notes.”
This joint rule was amended from the
123rd Legislature’s version by adding a requirement that OFPR, if requested by
a committee, present its analysis and copies of written materials used to
prepare a fiscal note. This presentation
must be at a public work session for which the sponsor has been given prior
notice from the committee clerk. This
change formalizes a process to explain the fiscal note. This is something OFPR would have done anyway
at the request of a committee, but this ensures that the sponsor is aware of
the work session on the fiscal note.
The
other change added by the 124th Legislature was a requirement that the
committee clerk provide OFPR with a copy of all testimony and written materials
of a bill or resolve that receives a favorable recommendation. This addition was intended to make sure that
OFPR has access to the information presented by the sponsor and others at
public hearings and work sessions.
Role and Organization of OFPR
The last sentence of Joint Rule 312
places sole responsibility for preparing fiscal notes with OFPR, one of the
non-partisan legislative staff offices.
OFPR’s responsibilities, in addition to fiscal note preparation,
include: staffing the Joint Standing Committees on Appropriations and Financial
Affairs and Taxation; jointly staffing the Joint Standing Committee on
Transportation; and providing the Legislature with fiscal research and
analyses.
Each analyst within OFPR is assigned
specific departments and agencies that are grouped within policy areas for all
responsibilities, including budget analyses and fiscal note preparation. Policy areas are groupings of similar
departments and agencies that generally align with the policy committees of the
legislature. OFPR has been organized in
this manner so that analysts, over time, gain a greater degree of understanding
of the programs and agencies in their respective policy areas. A listing of the analysts within OFPR and
their policy area assignments is available on OFPR’s web page at: http://www.maine.gov/legis/ofpr/contact.htm.
Role of Departments and Agencies
Although the Legislature’s Joint
Rules specify that OFPR has the sole responsibility for preparing fiscal notes,
state departments and agencies play an important role in the fiscal note
process. Departments and agencies charged
with implementing a legislative change typically have very specific knowledge
of the programs and the effect that proposed legislation may have on those
programs. This expertise and program
specific knowledge is a very important resource. OFPR utilizes this expertise as part of its
analysis of proposed legislation and has formalized department and agency input
into the process.
Departments and agencies are
expected to review all legislation for an impact on their programs. OFPR has asked that departments and agencies
submit an estimate of the fiscal impact of the legislation to OFPR five working
days prior to the scheduled public hearing on the bill. OFPR considers the estimates submitted by
departments and agencies as part of its fiscal note analysis. However, these estimates submitted by the
departments and agencies are not fiscal notes. As noted earlier, fiscal notes are prepared
only by OFPR pursuant to Joint Rule 312 of the Legislature. Appendix F describes the responsibilities of
departments and agencies in the fiscal note process in greater detail.
Other Sources of Information
Although departments and agencies
play a major role in the fiscal note process, they are not the only sources of
information used by OFPR to develop fiscal notes. OFPR analysts must use their own knowledge of
the departments and agencies to assess the accuracy of information submitted by
departments and agencies and to finalize an objective, non-partisan fiscal
note.
In the event that the information
submitted by departments and agencies is suspect or is challenged or
departments and agencies do not have sufficient information, OFPR may access a
number of other sources of information to refute, confirm and/or supplement
department and agency information. These
sources include:
·
Executive,
judicial and legislative staff in other states;
·
Federal
Government sources
·
Lobbyists
and lobbying sources;
·
Local
government sources;
·
·
National
Conference of State Legislatures, Council of State Governments and other
similar organizations.
Other important information
resources available to OFPR include:
|
|
|||
· AdvantageME |
- the State’s automated financial management
system that accommodates accounting functions |
|||
· Data
Warehouse |
- State’s
information warehouse that contains position, budgeting and accounting data |
|||
· Budget
and Financial Management System |
- Bureau of the Budget information system for
biennial budget information and annual work program data for state
departments and agencies |
|||
IV. Types of Fiscal
Impacts Described in Fiscal Notes
The fiscal impacts described in
fiscal notes concentrate on the direct fiscal impact of the legislation
on state government expenditures and revenue and the costs to local units of
government. Fiscal notes do not try to
assign a monetary value to the social benefits of a piece of legislation or
conduct extensive modeling to determine the secondary and tertiary economic
impacts (also known as “dynamic” analysis – see Appendix D for more discussion
on this type of analysis). While these
indirect impacts are not included in the fiscal note, it does not mean that they
are necessarily neglected by legislators.
There are ample opportunities for these considerations to enter the
various debates on a bill. While only
the direct fiscal impact is considered in the “funding” of a bill within the
constraints of either the balanced budget requirements of the General Fund or
Highway Fund budgets, these other considerations may play a role when the
Legislature prioritizes bills.
The impact of a bill or amendment on
the finances of state government described in fiscal notes may fall into
several different categories. The impact
of a piece of legislation may require additional funding for an agency to
implement the requirements of the legislation, it may generate savings within
an agency, it may generate revenue or it may decrease revenue. The timing of the fiscal impact must also be
considered. Does the bill affect state
finances during the current and immediately-ensuing fiscal biennium or only during
future biennia? The fiscal impact of
legislation must also be considered with respect to which fund it affects. These considerations are discussed below.
Type of Funds Affected
Government accounting uses funds and
account groups for financial reporting purposes. A fund is a separate accounting entity with a
self-balancing set of accounts to record expenditures, revenue, assets and
liabilities. The General Fund, the
largest of the State’s operating funds, finances all State Government
activities not otherwise segregated as a result of being funded by revenue
designated by special regulations, restrictions or limitations imposed by the
source of the revenue. The Highway Fund
is a special “dedicated” fund as a result of a provision in the Maine
Constitution limiting the expenditure of revenue derived from motor vehicle fuel
taxes and fees. Other restrictions or
regulations create the need for dedicated revenue funds, the Federal
Expenditures Fund, the Federal Block Grant Fund, Enterprise Funds, Internal
Service Funds, Debt Service Funds and Trust and Agency Funds. The analysis involved in developing a fiscal
note for a bill or amendment must consider which of the State’s numerous funds
are affected in terms of any revenue generated or lost, any expenditures
required to implement a bill or costs savings generated by a proposal. Unless specified in the bill, the impact is
assumed to be a General Fund impact.
Fiscal notes will identify costs in legislation even if there is no appropriation or allocation in a bill. If OFPR’s analysis indicates an original bill without appropriations or allocations will require positions or other expenditures to accomplish the intended outcome, the fiscal note will be written to identify what funding would be required. If analysis of a committee or floor amendment indicates funding is required, OFPR will draft an appropriation or allocation and insert it into the bill and the fiscal note will be written to indicate funding is in the bill. It is important to emphasize that a committee or sponsor of a floor amendment has the authority to decide whether or not to include the recommended funding. The fiscal note will then react to that decision. OFPR’s role is to analyze, recommend and, barring objection, provide the funding required to accomplish a bill’s objectives. If costs are identified but recommended funding is rejected, the fiscal note will be rewritten to indicate there is still a cost to perform the new requirements, that no funding was provided and that there may be a negative impact on other programs or services.
Bills must be analyzed with respect to the timing of their impact. Budget biennia are two-year periods beginning July 1 of odd numbered years. In addition to appropriating and allocating to the current fiscal year that ends June 30, 2009, the 124th Legislature will appropriate and allocate funds effective for the budget biennium that begins July 1, 2009. These costs, as well as savings generated through deappropriations and deallocations, are shown in fiscal notes and are generally described as “current” costs or savings. Revenue increases or decreases for the same period are also reflected in fiscal notes and are generally described as “current” revenue increases or decreases.
Public Laws of 1995, Chapter 368, Part EE (5 MRSA, §1665, sub-§6) added a requirement that departments and agencies submit fiscal impact statements that describe the revenue and expenditure effects of bills for the current biennium and for the following biennium. OFPR identifies the “future” costs/revenue effects that occur outside of the current fiscal biennium with emphasis on effects that exceed the normal growth of the appropriations, allocations and/or revenue estimates identified for the current biennium in the fiscal note. For the 124th Legislature, fiscal notes will present estimated costs through the fiscal year ending June 30, 2013. If there are additional substantial impacts further in the future, the fiscal note will indicate those as well.
Insignificant/Minor Costs or Savings and
No Fiscal Impacts
Fiscal analysis of proposed
legislation may identify bills with insignificant or no fiscal impact. These bills typically have represented just
over 40% of the total number of printed bills.
Bills and amendments that add minor costs or minimal new requirements on
state government programs and agencies and, by themselves, do not require the
appropriation or allocation of funds are identified as “Minor Costs”. This type of bill has also been referred to
as a “cost absorbed” bill. Bills that
generate minor savings or increase revenue by minor or negligible amounts are
identified as “Minor Savings”.
The determination of what is a minor
cost, savings, or revenue effect depends primarily on the program or revenue
source affected. The size of program or
revenue source is a primary determinant of whether a fiscal impact is minor and
can be absorbed within existing budgeted resources. There is no set cut-off amount that
determines whether a fiscal impact can be classified as “minor” or
“insignificant.” OFPR must make a
judgment based on the individual circumstances surrounding the legislation and
the programs affected.
There are some bills (approximately
15 to 20% of the bills introduced) that fall into the category of having no
fiscal impact on state government. This
type of bill includes, but is not limited to, those that affect
non-governmental agencies in such a way as to have no direct impact on state
government costs or revenues or that correct errors and inconsistencies in the
laws. For those bills that fall into
this category, no fiscal notes are required.
In practice, OFPR may issue a preliminary fiscal impact statement for
the original bill indicating there is no fiscal impact but no fiscal note would
be publicly released for amendments with no fiscal impact.
Direct Costs Incurred by Local Units of
Government
The passage of the Constitutional
Amendment to restrict unfunded state mandates on local units of government has
had a significant effect on the content of fiscal notes since the 1st Regular
Session of the 116th Legislature. Until
that time, OFPR was required by statute (3 MRSA, section 163-A, sub-section 12)
to include in the fiscal note a statement of the costs to municipalities and
counties for implementing or complying with proposed law, subject to the limit
of the information provided to OFPR. In
actual practice, because information on the local costs was not made available
to OFPR, very few statements of costs to municipalities and counties were
included in fiscal notes.
The Constitutional Amendment, which
requires the State to fund at least 90% of the cost of a state mandate unless
two-thirds vote of each house provides an exemption to this requirement, has
effectively made the local government costs of state mandates potentially state
government costs. Since the 116th
Legislature the costs of state mandates have been identified in fiscal
notes. (Appendices B and C provide more
detail on the description of what constitutes a state mandate and the
procedures OFPR follows with respect to estimating costs to local units of
government).
Impacts on the Correctional and Judicial
Systems
The Department of Corrections (see
34-A M.R.S.A., §1402, subsection 9) and the Judicial Department (see 4 M.R.S.A.,
§17, subsection 17) are required to submit statements describing the impact of
a bill on the correctional system and the judicial system, respectively. These requirements were made much more
stringent by amendments added by the 123rd Legislature in PL 2007,
chapter 240, Part YYY, adding additional information gathering requirements and
better annual estimates. OFPR considers these
statements when analyzing a bill or amendment and includes a summary of the
impact on the correctional and judicial systems in its fiscal notes.
V. Form and
Distribution of Fiscal Notes
Fiscal notes may take several
different forms depending on the type of legislation which they are
describing. The goal of OFPR is to
distribute this information to the appropriate decision makers in a timely
manner so that the information contained in the fiscal note is properly
considered at all stages of a bill’s or amendment’s progress through the
Legislature. Fiscal notes for amendments
and committee reports and preliminary fiscal impact statements for original
bills are accessible through the Legislature’s web site. Provided below is a description of the
various forms fiscal notes may take.
Appendix E provides samples of each of these forms.
Original Printed Bills or Legislative
Documents (LDs)
OFPR reviews each printed bill or
Legislative Document (LD), although not required by the Legislature’s Joint
Rules at this initial stage of a bill’s progress through the Legislature. Joint
Rule 312 only requires a fiscal note for bills that have received a favorable
committee report. However, OFPR often puts
a substantial amount of effort into bills at an early stage for several reasons. First, it gets this information to the
committees so that it may be considered during the committees’
deliberations. Second, this early
analysis helps OFPR respond more quickly to subsequent requests for fiscal
reviews of amendments when a committee is ready to report out a bill. Third, printed bills are also more widely
distributed than amendments (particularly proposed amendments), which makes it
easier for OFPR to gather input from various sources as part of its analysis. OFPR tries to provide preliminary fiscal
impact statements to committees and sponsors prior to public hearings on bills
based on the information that it has been able to gather up to that point. These statements, which are subject to change
based on new information gathered as bills work their way through the committee
process, are intended to identify fiscal issues early in the process so that
they can be addressed, if necessary, by the committee.
In
some unusual circumstances, an original bill may include an actual fiscal
note. This occurs if it is known that a
bill is not going to be referred to committee or if the bill represents a
committee report. The fiscal note would
be included and printed as part of the bill and would appear immediately after
the summary.
Committee Amendments
Joint Rule 312 requires that every
bill with a fiscal impact being reported out favorably from a committee must
have a fiscal note attached. OFPR works
closely with committee staff to react to committee reports on bills and turn
them around and get this report to the full Legislature as quickly as possible
after the committee has taken final action.
After reviewing drafts of the committee report(s), OFPR develops a
fiscal note or fiscal notes if there is more than one favorable report from the
committee. The fiscal note for a
committee amendment describes the fiscal impact of the entire bill as amended
by that committee amendment, not just the incremental change. The fiscal note is made available to
committee staff electronically as an Excel file. Additionally, it is printed on the back of
the committee amendment and distributed with the amendment.
Floor Amendments
Joint Rule 312 also requires floor
amendments to receive a fiscal note.
Every floor amendment is reviewed by OFPR prior to printing. Drafts are received from the Office of the Revisor
of Statutes and receive immediate attention.
The fiscal note for a floor amendment is attached in a similar manner to
the committee amendment. However, floor
amendments only address or describe the fiscal impact of the amendment and not
the impact of the entire bill as amended.
In other words, they are incremental rather than comprehensive or
cumulative. An exception to this would
be the case where a committee amendment is released without a fiscal note in
error. If such an omission occurs, a
separate floor amendment can be drafted with a comprehensive fiscal note
attached to avoid the bill being ruled out of order on the floor of the House
or Senate for lacking a fiscal note.
Engrossed Bills
OFPR reviews bills after they have
been engrossed and distributes a fiscal note describing the fiscal impact of
the bill as engrossed. The engrossed
copy of a bill is how the bill will appear in the published laws if approved by
the Legislature and the Governor. The
distributed copy of the engrossed bill contains no summary or fiscal note. Fiscal notes for engrossed bills are
distributed separately to each house of the Legislature describing the fiscal
impact of the bill as engrossed. This
fiscal note reflects the final “scoring” of a bill’s impact on the State’s
budget and incorporates the incremental effects added by accepted floor
amendments.
This overview summarizes the major
aspects of the fiscal note process so that legislators, departments and
agencies and the general public have a better understanding of this
process. One of the most important
points to stress is that any questions regarding individual fiscal notes or the
fiscal note process by anyone, Legislator, state agency representative, or
member of the general public should be brought directly to OFPR’s attention. OFPR will explain the methodology and
assumptions used to develop a fiscal note on any bill or amendment. OFPR also stands ready to listen to concerns
about specific aspects of the fiscal note process and encourages your comments
on ways to improve upon it. The office
is located in Room 226 of the State House.
The telephone number is (207) 287-1635.
Special Appropriations Table,
I. Introduction
The
act of tabling a bill or motion is the process of setting aside or deferring
action on the bill or motion. The
Special Appropriations Table and the Special Highway Table are special
processes in the Maine State Senate for deferring actions on bills affecting General
Fund appropriations and/or revenue and Highway Fund allocations and/or revenue,
respectively. These tables were designed
to track legislation affecting the General Fund and Highway Fund; to provide
equitable treatment for these bills; and to maintain balanced General Fund and
Highway Fund budgets.
These
special tables are established by Senate Orders. These orders are printed in the Senate
Calendar, usually very early in the First Regular Session.
Special Appropriations Table - Created by
Senate Order, usually on 1st legislative day of new session
“Ordered, that all Bills and Resolves
carrying or requiring an appropriation or involving a loss of revenue that are
in order to be passed to be enacted, or finally passed, shall, at the request
of a member of the Committee on Appropriations and Financial Affairs, be placed
on a special calendar to be called up for consideration only by a member of the
Committee.”
Special Highway Table - Created by Senate
Order, usually on 1st legislative day of new session
“Ordered, that all Bills and Resolves
carrying or requiring an appropriation of highway revenue or involving a loss
of highway revenue that are in order to be passed to be enacted, or finally
passed, shall, at the request of a member of the Committee on Transportation,
be placed on a special calendar to be called up for consideration only by a
member of the Committee.”
II. Purpose of the Special Appropriations
Table and
These
tables have been established to provide the Joint Standing Committee on
Appropriations and Financial Affairs and the Joint Standing Committee on
Transportation with methods of making sure that the General Fund and the
Highway Fund, respectively, are maintained as balanced budgets. They also place the decisions for bills
affecting the General Fund and the Highway Fund with the Committees charged
with the oversight of those specific funds, rather than distributing these
decisions to other policy committees.
Note:
Reference to “requiring an appropriation” in these orders has been
interpreted by the Office of Fiscal and Program Review to mean current biennium
costs, future costs, and potential costs.
These
tables provide a formal method for tracking the effect of legislation on the
General Fund and Highway Fund. Tracking
these bills could be done on an on-going basis and be factored into the
decision-making processes of both budgets.
However, this on-going tracking process would make the budget decisions
of the Joint Standing Committees on Appropriations and Financial Affairs and
Transportation reactive rather than proactive. The budget bills usually include the major
financial decisions regarding the General Fund and Highway Fund. Therefore, to maintain their central role in
the budget decision-making process, the Legislature has decided to defer action
on most other bills affecting the General Fund and Highway Fund until after the
budget bills have been reported out of their respective committees and
enacted. Other bills with General Fund
or Highway Fund impacts must compete equally for finite resources rather than
on a first come, first served basis.
III. Process of Tabling Bills
The
authorizing Senate Order passed early in the session specifies any senate
member of the Joint Standing Committee on Appropriations and Financial Affairs
may make the motion to set aside a bill on the Special Appropriations
Table. The same rule applies to senate
members of the Joint Standing Committee on Transportation for the Special
Highway Table. Motions to place bills on
either of these tables are made when the bill is pending final enactment in the
Senate. The Senate Chairs of the
Committee on Appropriations and Financial Affairs and the Committee on
Transportation usually make the motions to table on the Special Appropriations
and Special Highway Tables, respectively, but other members of those
committees, in the absence of the chairs, may make motions to table bills on
the Special Appropriations and Special Highway Tables.
IV. Role of the Office of Fiscal and Program
Review
The
Office of Fiscal and Program Review (OFPR), a non-partisan staff office of the
Legislature, provides the Legislature with fiscal research and fiscal notes and
staffs the Joint Standing Committees on Appropriations and Financial Affairs,
Taxation and Transportation. All bills with
a fiscal impact are tracked through the fiscal note process administered by
OFPR. Given its roles in the fiscal note
process and the staffing of the Committee on Appropriations and Financial
Affairs and the Committee on Transportation, OFPR has the role of notifying the
members of the committees, usually through the respective Senate chairs, when a
bill up for final enactment meets the criteria for placement on the Special
Appropriations and Special Highway Tables.
OFPR
produces reports about the bills and resolves on these tables. These reports summarize the expenditure and
revenue impacts of each bill. OFPR also
provides staff assistance to the Committee on Appropriations and Financial
Affairs, the Committee on Transportation and Legislative Leadership during the
final decision-making phases of the bills on these tables.
V. Types of Bills and Resolves to be Placed
on These Tables
Not
all bills with fiscal impacts get placed on the Special Appropriations Table or
the Special Highway Table. A general
rule is applied by OFPR in making recommendations regarding whether a bill
should be placed on these tables. If any
bill or any portion of a bill includes a General Fund appropriation or
deappropriation, a General Fund revenue reduction or any other General Fund
cost, that bill should be set aside on the Appropriations Table. The same criteria applies for the Highway
Fund Table. Bills that should be tabled
include:
·
Bills that include General Fund appropriations
or Highway Fund allocations;
·
Bills that include General Fund deappropriations
or Highway Fund deallocations;
·
Bills that reduce General Fund revenue or
Highway Fund revenue; and
·
Bills that increase future General Fund or
Highway Fund costs or reduce future General Fund or Highway Fund revenues.
A
bill that includes a General Fund appropriation or Highway Fund allocation that
may be offset by additional General Fund or Highway Fund revenue, General Fund
deappropriations or Highway Fund deallocations, will still receive a
recommendation to be tabled even though the overall net impact could be
positive to either fund.
If
bills affect both the General Fund and the Highway Fund in such a way that a
recommendation would be made to place the bill on both Tables, these bills will
be recommended to be placed on the Special Appropriations Table.
The
committees may decide to exempt a particular “emergency” bill from being placed
on either of the funding tables. By
tradition, the appropriate committee usually holds a public work session and
specifically votes to exempt that bill from being placed on the respective
table.
VI. Final Action on Bills and Resolves on
These Tables
Special
Appropriations Table
After
the budget bills have been enacted or are pending enactment and the amount of
funding still available for the table is known, the Joint Standing Committee on
Appropriations and Financial Affairs reviews all bills placed on the table
throughout the session and makes its decision on each . These decisions are made with a significant
amount of input from other sources.
Other committees are required, within 5 working days after reporting out
all of their bills, to notify the Joint Standing Committee on Appropriations
and Financial Affairs of their priorities of bills that are on the Special Appropriations
Table. Leadership, sponsors and other
interested parties are often involved in working out compromises or agreements
for final disposition of bills on the table.
Bills are passed as is, amended to change the cost or killed
outright. There are no voting
requirements specified in the joint order that created the table. By tradition, decisions are made by majority
vote.
Special Highway
Table
The
Special Highway Table decisions are made at approximately the same time as the
Special Appropriations Table decisions.
No other committees are required to submit priorities to the
Transportation Committee and leadership does not usually get involved in the
resolution of the Special Highway Table.
As there are no voting requirements specified in the joint order,
decisions are traditionally made by majority vote.
VII. Special Study Table
Many potential
studies are proposed during a typical legislative session. Although many are included in a bill when it
is being worked in committee, others are created in response to offered bills
that generate the desire for more information or other alternatives before
enacting. The purpose of the Special
Study Table is to prioritize among the studies so that limited financial and
staff resources may be used in the most efficient and effective way. Typically studies are scheduled for the
interim period between legislative sessions when staff and legislators are not
overwhelmed with the business of the legislature. Bills may be placed on this table in either
the House or Senate, usually by a member of the Legislative Council. The Special Study Table is essentially a
function of the Legislative Council and as such, the Executive Director’s
office plays an important role in communicating with the Council throughout the
process. As it does with the Special
Appropriations Table and the Special Highway Table, OFPR helps monitor bills
that may need to be set aside on the Special Study Table and facilitates the
process by alerting Senate staff when it is aware a bill is arriving on the
floor that needs to be tabled. Near the
end of the session the Legislative Council reviews the studies and makes its
decisions for expenditure of the legislative study budget dollars. Some studies will be amended, some funded, and
others killed outright. If a study is
recommended by the Council and is to be funded from a direct appropriation
apart from the study budget, OFPR will help get the bill sent to the Special
Appropriations Table where the additional costs may be considered and funded by
amendment.
Special Study Table - Created by Joint
Rule, usually on the 1st legislative day of new session
Joint Rule 353, §8:
“All joint orders or legislation
proposing legislative studies regardless of funding source must be placed on a
special study table in the House or Senate.
The Legislative Council shall review the proposed studies and establish
priorities for allocation of budgetary and staffing resources.”
Fiscal Notes and Cost Estimates for State
Mandates
124th Legislature
I. Mandate
Identification on individual bills
In addition to
describing the fiscal impact on state government, a fiscal note (or preliminary
fiscal impact statement) will also identify possible state mandates and may
include a very rough estimate of costs and type of local unit affected. The initial fiscal note will not provide a
detailed cost estimate unless sufficient information is provided at the same
time as other fiscal information, e.g., if departments or state agencies have
reliable data available which will allow an accurate estimate of the municipal
or county costs. The Maine Municipal
Association or other interested parties with data available to generate a
reliable estimate of the local costs should forward that information directly
to OFPR. Whether a proposal creates a
state mandate under the Maine State Constitution is a legal question and while
a fiscal note may identify a potential mandate, it is not a legal opinion. As with any other question of constitutional
law relating to legislative proposals, the Legislature may want to seek
appropriate legal advice on any questions concerning mandates.
II. Committee Reports for Bills with State
Mandates
If a bill that
contains a mandate is going to be reported out favorably from a committee, a
committee has several options. OFPR’s
level of analysis will depend on which of the following options a committee
chooses:
·
Exempt the Bill
by including a Mandate Preamble - The committee may decide to exempt the
mandate from the funding requirement by including a Mandate Preamble that
requires a two-thirds favorable vote in both Houses. OFPR will normally provide a very rough
estimate of the cost and scope of the mandate.
·
Reconsider
Committee Report to remove the Mandate – A committee may decide to eliminate
the mandate by amending its report to remove the requirement that created the
mandate. OFPR will work with the
committee and staff to review the changes.
·
Fund the
Mandate
- The committee may decide to recommend funding the mandate by including
appropriate funding in the bill. For
these committee reports, OFPR will provide a more detailed assessment of the
total cost of the mandate.
·
Defer Decision
on Funding the Mandate - The committee may also decide to report the
bill out without funding and without a Mandate Preamble. OFPR may include a rough estimate of the cost
of the potential mandate in the fiscal note, similar to OFPR’s treatment of
original printed bills.
In the last two cases, the bills
will normally be placed on the Special Appropriations Table and decisions
regarding the funding will be deferred until the end of the session when the
Joint Standing Committee on Appropriations and Financial Affairs makes
decisions on bills placed on this table.
If a bill with a state mandate is passed without funding or a mandate
preamble, the local units of government affected will not be bound by the
mandate.
III. Floor
Amendments that include State Mandates
Given the limited amount of time
available to assess the fiscal impact of floor amendments, OFPR will identify
but may not estimate the cost of potential mandates. If time permits, an estimate may be
provided. If a potential mandate is
identified on a floor amendment, the sponsor has the same options as a
committee.
IV. Other Requests for Municipal Cost
Estimates
OFPR will
attempt to provide estimates of the local fiscal impact of other non-mandate
legislation as requested, resources permitting.
A
Brief Explanation of the “State Mandate” Law
The constitutional provision relating to
state mandates (Article 9, §21), as applied pursuant to implementing
legislation (30-A MRSA §5685) provides that the State may not require a local
unit of government to expand or modify its actions so as to necessitate
additional expenditures from local revenues, unless the State provides 90% of
the funding for those new expenditures.
Local units of government include cities, towns, plantations, counties,
school units and other local governmental entities that are established under
legislative authority to perform a public function and are funded by local
revenues and administered by governing bodies that are responsible to the
public. The provision applies to laws,
rules or executive orders. The provision
permits the State to create specific exemptions to the funding
requirement. This is accomplished by
legislation that includes a Mandate Preamble and that is passed by a two-thirds
vote of both Houses.
Under the implementing law, the
State may not meet its funding obligations by requiring a local unit of
government to use funds previously appropriated to the unit for another purpose
or by authorizing new local taxes or fees to be raised. State actions to comply with federal
requirements need not be funded by the State, except to the extent that the
State's requirements exceed the federal requirements.
In each fiscal year, a local unit of
government must receive the required state funding prior to implementing a
mandate or it is not obligated to conform to the mandate. State agencies must develop mandate payment
distribution schedules for each mandate they administer. The schedules are designed with local input
to periodically pay local units the costs of complying with mandates prior to
incurring the additional costs.
When analyzing whether a law, rule
or executive order represents a state mandate, at least two questions must be
asked.
1. Does
it require a local unit of
government (see attached list of qualifying local governmental units) to expand
or modify its activities?
2. If
it does require such an expansion or modification of activities, does that
requirement necessitate additional expenditures from local revenues?
The following general statements about mandates
are based on OFPR’s current understanding of the constitutional provision and
the implementing law:
·
The fact that a
bill is introduced on behalf of and with the support of a local unit of
government
does not affect the mandate analysis. If a bill imposes a mandate, local unit
support does not remove that mandate.
·
Bills
generating revenue at the local level or net savings in aggregate
are mandates if they include any requirements that may result in any local unit
of government incurring additional costs to implement.
·
Bills
establishing a new state requirement that some or all municipalities may
already have implemented or bills prohibiting cuts in programs are mandates
even though many local units may be in compliance.
·
Bills of
general applicability, such as bills that affect employers generally
or environmental regulations that are not directed at operations specific to
local units of governments or bills that create new crimes or enhance the class
of certain crimes, are not state mandates because they do not primarily affect
a local unit's governmental activities.
·
Bills setting
new standards for discretionary programs, such as bills that require local units
of governments to perform certain activities if those units choose to implement
a particular program, are not state mandates because they do not actually
require those local units of government to expand or modify their activities.
·
Bills reducing
state subsidies are not state mandates because reducing state subsidies
alone does not actually require local units to expand or modify their
activities.
·
Proposed constitutional
amendments
are not state mandates because constitutional referenda are expressly excluded
under the implementing legislation.
I. Cost
Estimation of Mandates
The Office of Fiscal and Program
Review is the agency solely responsible for preparing all fiscal notes on bills
and amendments introduced before the legislature. Since under the Joint Rules a bill must
include a fiscal note if it includes a mandate, the Office of Fiscal and
Program Review, by implication, is responsible for identifying and estimating
the cost of potential mandates.
Some
issues related to cost estimation of mandates include:
· Net costs versus component costs. Since the State may not meet its obligation
to provide its share of state funding by authorizing a local unit to levy new
fees or taxes, revenues from such sources are excluded from the calculation of
local expenditures for which state funding must be provided. The fiscal impact of a mandate is calculated
based on the additional expenditures necessitated by each required expansion or
modification of activity.
· Funding of existing programs. If a mandate applies to an existing activity
of some local units of government but a new activity for other units, the state
must fund 90% of the cost to those units that already have implemented the
required activity as well as those units that have not implemented the required
activity.
· Timing of Funding. The timing of the costs to be incurred by
local units of government is also very important. The implementing law requires the
establishment of a payment distribution schedule for each funded state mandate
so that payments are received by a local unit of government prior to that unit
having to make the required expenditures.
II. Rules
and Executive Orders
Executive Orders and routine
technical rules that propose new mandates on local units of government are not
voted on by the Legislature. The
Executive Branch may not create exceptions to major substantive rules that do
require legislative approval and the legislation providing for that approval
can address any mandate issues raised by such rules.
III. Local
Units of Government Covered by the “State Mandate” Law
A Local Unit of Government, as
defined by the implementing law, means any city, town, plantation, county,
school administrative unit or governmental entity that is:
1.
Created or authorized by special act of the
legislature;
2.
Established to provide public services;
3.
Funded by local revenues;
4.
Governed by a locally elected body or a body
appointed by a municipality or county; and not an agency of State Government or
other entity having statewide authority, jurisdiction or purpose.
Therefore,
Local Units of Government include but are not limited to the following:
·
All cities and towns;
·
Counties;
·
Plantations;
·
School Administrative Units;
·
Water Districts; and
·
Sewer Districts.
Some examples
of entities that are not included would be:
·
The Unorganized Territories;
·
The
·
The
·
The
·
The
·
The
Role
of Fiscal Notes in Revenue Recognition
I. Fiscal
Notes or Revenue Forecasting Committee
In addition to providing fiscal
information on proposed legislation to improve the decision making process,
fiscal notes establish the amounts of revenue in enacted bills that become part
of the budget. While the Revenue
Forecasting Committee (RFC) determines the official projections for pre-existing
or “baseline” revenues based on economic and other factors, the fiscal note
process determines the levels of revenue that come (legislatively) from
statutory changes in newly enacted legislation.
The amount of revenue recognized by the RFC and the amounts recognized
through the fiscal note process combine to become the official amount of
revenue available for expenditure in the budget for the General Fund, Highway
Fund and Fund for a Healthy Maine. On
occasion the line between which process, revenue forecasting or fiscal note,
should determine a particular level of revenue has become blurred and a brief
discussion of this issue follows.
By
statute, the RFC estimates baseline revenues twice each year and releases
formal reports on these on December 1st and May 1st of
odd- numbered years and December 1st and March 1st of
even-numbered fiscal years. These
estimates represent what is expected to be collected based on current law. Revenue that may be generated or decreased
from changes to current law is booked or “scored” in fiscal notes. Once the revenue impact of a statutory change
has been initially booked in a fiscal note, that revenue becomes part of the
baseline revenues and any subsequent projection of it is properly accounted for
by the RFC. It has occurred in the past
that legislation has been proposed that would change an existing estimate of
revenue without changing any underlying statute that would cause a revenue
amount to change. Such attempts to
adjust baseline estimates of revenue legislatively (through fiscal notes) are
inconsistent with the role of the RFC and jeopardize the bipartisan acceptance
of the RFC process. The RFC does have a
mechanism that allows it to convene a meeting to revise revenue when it
believes its previous estimate may be substantially incorrect and this is
preferable to using legislation to simply state that a particular revenue
source shall be booked at a different level than was estimated by the RFC. OFPR will only recognize revenue in a fiscal
note that is caused by a legislative change, such as increasing a tax or fee or
by adding positions to collect additional revenue.
II. Static
versus Dynamic Revenue Estimates
Revenue
estimates that do not take into consideration behavioral changes of any kind
attributable to the passage of statutory changes would be considered static
estimates. On the other end of the
spectrum, revenue estimates that do consider behavioral changes that might be
anticipated from statutory changes would be referred to as dynamic estimates. In the State of Maine, OFPR employs a modified
form of dynamic forecasting in fiscal notes that could be referred to as
“micro-dynamic” estimating, which considers some behavioral changes on
individuals directly impacted by legislation but not behavioral changes that
might change the economy as a whole, which could be called “macro-dynamic”
estimating. This is especially important
in evaluating tax legislation, where Maine Revenue Services (MRS), using
sophisticated computer modeling, uses a micro-dynamic methodology to provide
OFPR with the potential impact of tax legislation. There is no attempt to quantify any secondary
or dynamic revenue changes that may come about from the impact of legislation
on the overall economy. For example,
the fiscal note for a proposed substantial tax rate increase would consider the
micro-dynamic effects of behavioral changes to avoid the tax but not try to
adjust for any secondary macro-dynamic effects on the economy as a whole. Generally, this is a revenue recognition issue
more likely to effect tax legislation than other areas. Proponents of tax proposals are often
disappointed to find that a fiscal note will score a revenue loss for tax
credits or exemptions but not attempt to offset the loss by booking a potential
stimulus to economic growth from the proposal.
The consideration of economic consequences in fiscal notes would greatly
increase their complexity and move focus away from the direct impact of a
proposal. If any bills were to be
measured this way, fairness would dictate they all would need to be. Given the generally small impact economic
analysis would have on 99.9% of the fiscal notes, OFPR has not invested in the
additional resources or additional economic modeling capability that would make
it possible.
III. Compliance/Enforcement
Assumptions
Another
issue that has created some controversy in the past is the fiscal note
treatment of bills that arise from audit adjustments and compliance. As the result of an audit the state may
assess a taxpayer for an outstanding tax liability. That taxpayer may seek relief from the
Legislature, resulting in a bill to change the law retroactively. An argument that often gets made is that
there should not be a cost to passage of the bill because the tax was not being
collected prior to the audit finding. However, the fiscal note would show a revenue
loss because the baseline revenues already assume that there will be
collections resulting from bringing taxpayers into compliance through audit
adjustments and any retroactive change to tax law would negate the possibility
of collecting those taxes.
IV. Timing
Issues
Fiscal
notes will consider the timing of an impact of a statutory change so that it is
consistent with expectations for behavioral changes that result. For example, a bill to cut sales tax rates by
50% on July 1 would be an incentive for taxpayers to delay purchases that would
otherwise have occurred prior to July 1.
The behavioral change, in this case delay of purchases, would be
accounted for in the fiscal note and a revenue loss would be recorded for
reduced sales tax collected prior to July 1.
V. Interaction
Effects
Consumers
of fiscal notes will be advised that there can be an interaction between
various proposals in a legislative session that cannot be accounted for in the
fiscal notes for those proposals. Each
fiscal note for a proposed piece of legislation will score that proposal
against current law without regard for the possibility (or probability) that
other proposals could be enacted.
Summing the impacts expressed in the individual fiscal notes may not
provide the true revenue gain or loss that would be obtained if all the bills
pass. The revenue loss from a proposed
income tax exemption in one bill would be greater than expressed by its fiscal
note if another proposal to increase tax rates is enacted.
Sample
Fiscal Notes
Sample
Fiscal Note – Original Bill
Sample
Fiscal Note – Committee Amendment
|
|
|
|
|
Approved:
12/29/08 |
|
||
|
|
|||||||
|
124th |
|||||||
|
|
LD 5000 |
|
LR 9999(02) |
|
|
||
|
An Act to Provide Sample Fiscal Notes |
|||||||
|
||||||||
|
||||||||
|
Fiscal Note for Bill as Amended by Committee
Amendment " " |
|||||||
|
Committee: Health and Human Services |
|||||||
|
Fiscal Note Required: Yes |
|||||||
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
Fiscal Note |
||||||||
|
|
|
|
|
|
|
||
|
|
|
|
|
Projections |
Projections |
||
|
|
|
2009-10 |
2010-11 |
2011-12 |
2012-13 |
||
Net Cost (Savings) |
|
|
|
|
|
|||
|
General Fund |
|
$105,000
|
$150,000
|
$155,000
|
$160,000
|
||
|
|
|
|
|
|
|
||
Appropriations/Allocations |
|
|
|
|
|
|||
|
General Fund |
|
$105,000
|
$150,000
|
$155,000
|
$160,000
|
||
|
Other Special Revenue
Funds |
|
$0
|
$45,000
|
$45,000
|
$45,000
|
||
|
|
|
|
|
|
|
||
Revenue |
|
|
|
|
|
|||
|
Other Special Revenue
Funds |
|
$0
|
$45,000
|
$45,000
|
$45,000
|
||
|
|
|
|
|
|
|
||
Fiscal Detail and
Notes |
|
|
|
|
|
|||
|
The bill includes a
General Fund appropriation of $105,000 in fiscal year 2009-10 and $150,000 in
fiscal year 2010-11 to the Department of Testing for a Senior Tester position
and a Tester I position to prepare and conduct the tests required in section
2 of the bill. A $45 fee on testing
beginning in fiscal year 2010-11 will generate $45,000 in Other Special
Revenue Funds to fund an additional Tester I position in FY 2011. |
|||||||
|
||||||||
|
||||||||
|
Sample
Fiscal Note – Floor Amendment
|
|
|
|
|
Approved:
12/29/08 |
|
||
|
|
|||||||
|
124th |
|||||||
|
|
LD 5000 |
|
LR 9999(03) |
|
|
||
|
An Act to Provide Sample Fiscal Notes |
|||||||
|
||||||||
|
||||||||
|
Fiscal Note for House Amendment "A"
to Committee Amendment "A" |
|||||||
|
Sponsor: Rep. Sample |
|||||||
|
Fiscal Note Required: Yes |
|||||||
|
|
|||||||
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
Fiscal Note |
||||||||
|
|
|
|
|
|
|
||
|
|
|
|
|
Projections |
Projections |
||
|
|
|
2009-10 |
2010-11 |
2011-12 |
2012-13 |
||
Net Cost (Savings) |
|
|
|
|
|
|||
|
General Fund |
|
($20,000) |
($35,000) |
($35,000) |
($35,000) |
||
|
|
|
|
|
|
|
||
Appropriations/Allocations |
|
|
|
|
|
|||
|
General Fund |
|
($20,000) |
($35,000) |
($35,000) |
($35,000) |
||
|
Other Special Revenue
Funds |
|
$0
|
$35,000
|
$35,000
|
$35,000
|
||
|
|
|
|
|
|
|
||
Revenue |
|
|
|
|
|
|||
|
Other Special Revenue
Funds |
|
$0
|
$35,000
|
$35,000
|
$35,000
|
||
|
|
|
|
|
|
|
||
Fiscal Detail and
Notes |
|
|
|
|
|
|||
|
This amendment
increases the testing fee by $35 to $80 per test, dedicates a Tester I
position that was previously to be funded by the General Fund and delays that
position start date until July 1, 2010.
As amended, the bill includes one Senior Tester position plus related
expenses effective July 1, 2009 funded from the General Fund and two Tester I
positions effective July 1, 2010 funded from dedicated revenues. |
Sample
Fiscal Note – Final (Engrossed Bill)
|
|
|
|
|
Approved:
12/29/08 |
|
||
|
|
|||||||
|
124th |
|||||||
|
|
LD 5000 |
|
LR 9999(04) |
|
|
||
|
An Act to Provide Sample Fiscal Notes |
|||||||
|
||||||||
|
||||||||
|
Fiscal Note for Bill as Engrossed with: |
|||||||
|
C "A" (H-456) |
|||||||
|
H "A" (H-123) to C "A"
(H-456) |
|||||||
|
Committee: Health and Human Services |
|||||||
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
Fiscal Note |
||||||||
|
|
|
|
|
|
|
||
|
|
|
|
|
Projections |
Projections |
||
|
|
|
2009-10 |
2010-11 |
2011-12 |
2012-13 |
||
Net Cost (Savings) |
|
|
|
|
|
|||
|
General Fund |
|
$85,000
|
$115,000
|
$120,000
|
$125,000
|
||
|
|
|
|
|
|
|
||
Appropriations/Allocations |
|
|
|
|
|
|||
|
General Fund |
|
$85,000
|
$115,000
|
$120,000
|
$125,000
|
||
|
Other Special Revenue
Funds |
|
$0
|
$80,000
|
$80,000
|
$80,000
|
||
|
|
|
|
|
|
|
||
Revenue |
|
|
|
|
|
|||
|
Other Special Revenue
Funds |
|
$0
|
$80,000
|
$80,000
|
$80,000
|
||
|
|
|
|
|
|
|
||
Fiscal Detail and
Notes |
|
|
|
|
|
|||
|
The bill includes a
General Fund appropriation of $85,000 in fiscal year 2009-10 and $115,000 in
fiscal year 2010-11 to the Department of Testing for a Senior Tester position
plus related expenses effective July 1, 2009 to prepare and conduct the tests
required in section 2 of the bill. An
$80 fee on testing beginning in fiscal year 2010-11 will generate $80,000 in
Other Special Revenue Funds to fund two Tester I positions effective July 1,
2010. |
|||||||
|
||||||||
|
||||||||
|
||||||||
|
Guidelines
for Department/Agency Fiscal Estimate Preparation
State departments and agencies
(hereafter referred to as agencies) play an important role in the fiscal note
process. OFPR has formalized the input
of agencies in this process by requesting from each agency an estimate of the
fiscal impact of each bill or amendment that impacts that agency. The following information is intended to
guide each agency in responding to OFPR.
I. Agency Responsibilities for Responding
on Bills and Amendments
Every Legislative Document (LD)
and amendment must be responded to, in writing by the agency that is
affected regardless of whether the agency concludes that the legislative
document does or does not have a fiscal impact.
In most cases, the analyst working with the agency will call, fax or
E-mail the agency to notify the agency of the bills and amendments affecting
the agency. However, the analyst’s call
or contact with the agency is a courtesy and should not be relied upon. The ultimate responsibility for getting
fiscal estimate information to OFPR lies with the agency.
II. Timing Deadlines for Responses
OFPR needs a response to all
legislative documents (including amendments) within five working days of
their release to the general public. If
this deadline cannot be met, the OFPR analyst assigned to your agency (see
Appendix D for list) should be informed as to when the fiscal estimate will be
completed and forwarded.
Each agency should be aware that
there will be times during the session (particularly near the end of the
session) when the agency will not have five working days to respond to certain
LDs, new drafts and amendments (i.e., when an immediate response is
needed). An OFPR analyst will notify
each agency by phone when these situations arise.
III. Objectivity and Completeness of Responses
All fiscal estimates must be objective
and accurate. An agency’s
response should not be slanted to influence the policy-making process, which
involves the elected representatives of the people of the State of
·
Any assumptions used in preparing the
fiscal estimate should be clearly delineated.
·
The agency’s fiscal estimate should quantify the
LD’s impact in dollar terms.
·
When the agency believes the LD does have a
fiscal impact, the fiscal estimate should include the following:
A breakdown of any appropriation or
allocation needed, including the following:
-Program Name and Number(s)
-Fund(s)
-Fiscal Year(s)
-Position Count* and Type of Count (if
any)
-Personal Services (if any)
-All Other (if any)
-Capital Expenditures (if any)
-Totals
* When
a new position is being requested the agency must include the projected hire
date and the job title, range, and justification if other than the first step
is used to calculate the salary costs of the new position.
Revenue increases/decreases by fund and
fiscal year.
A brief description of the fiscal impact,
including any and all assumptions made.
Umbrella, unit, program and appropriation
number(s) for any appropriation/allocation estimate.
Any other information needed to fully
explain the agency’s estimate.
If it is difficult to specify the
fiscal impact, the best available estimate should be forwarded. A range can be used rather than a specific
number if it represents the “best” data available.
IV. Future
Impacts
5 M.R.S.A., §1665 requires agencies
to submit an estimate of expenditures and revenues for the current biennium and
the following biennium. For the 124th
Legislature, this means that agencies must estimate expenditures and revenue
through fiscal year 2012-13 and submit that estimate to the State Budget
Officer. This information must also be
submitted to OFPR.
V. Municipal Mandates
In 1992,
VI. Submitting Fiscal Estimates
Forms to submit fiscal estimates are
available from OFPR in hardcopy or Microsoft Excel file format. (A sample copy of the forms is included in
Appendix G.) Agencies may create their
own templates and forms as long as all the necessary information is included in
approximately the same format. Estimates
may be submitted by fax, e-mail or hardcopy whichever is most convenient.
Suggested
Form for Department/Agency Fiscal Estimate Preparation
Department/Agency
Fiscal Estimate Form - Summary |
|
||||||
|
|
|
|
|
|
|
|
|
|
Department Name |
|
|
|
|
|
|
|
Agency Code |
|
|
|
|
|
|
|
Fiscal Estimate
Compiled by |
|
|
|
||
|
|
Date Submitted to OFPR |
|
|
|
||
124th |
|
Legislature |
|
|
|
|
|
|
|
LD # |
|
|
|
|
|
|
|
LR # (if no LD) |
|
|
|
|
|
|
|
Item # |
|
|
|
|
|
Bill Title |
|
|
|||||
|
|
|
|
|
|
|
|
|
|
Item Type (Original
Bill or Amendment) |
|
|
|||
|
|
|
|
|
|
|
|
For Amendments: |
|
|
|
|
|||
|
|
Does amendment change
the fiscal impact? (Yes or No) |
|
|
|||
|
|
Is fiscal estimate
incremental or does it replace original bill's estimate? (I or R) |
|||||
|
|
|
|
|
|
|
|
Summary of Impact |
|
|
|
|
|||
|
|
|
|
|
|
|
|
Select One or More of
the Following: (Please
explain in text box at bottom regardless of selection) |
|||||||
|
|
|
|
|
|
|
|
|
|
No Fiscal Impact |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Minor Cost/Minor
Revenue Decrease (Costs
can be absorbed - no change to budget) |
|||||
|
|
|
|
|
|
|
|
|
|
Minor Savings/Minor
Revenue Increase (No
change to budget) |
|
||||
|
|
|
|
|
|
|
|
|
|
Fiscal Impact (Complete Fiscal Impact
Detail - next tab) |
|
|
|||
|
|
|
|
|
|
|
|
|
|
State Mandate |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Fiscal Impacts (Bond Issue, Referendum
or Correctional/Judicial Impacts) |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Department/Agency Text
Box: |
|
|
|
|
|||
Include assumptions in
cost, savings or revenue impacts.
Describe any new responsibilities.
If mandate, indicate new requirements for local units of government. |
|||||||
Department/Agency
Fiscal Estimate Form - Detail |
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
0 |
|
Department Name |
|
|
|
|
|
|
||
0 |
|
Agency Code |
|
|
|
|
|
|
||
0 |
|
Fiscal Estimate
Compiled by |
|
|
|
|
|
|
||
12/30/2008 |
|
Date Submitted to OFPR |
|
|
|
|
|
|
||
124th |
|
Legislature |
|
|
|
|
|
|
|
|
0 |
|
LD # |
|
|
|
|
|
|
|
|
0 |
|
LR # (if no LD) |
|
|
|
|
|
|
||
0 |
|
Item # |
|
|
|
|
|
|
|
|
Bill Title |
|
0 |
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
Program #: |
|
Title: |
Program Title |
|
|
|||||
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
Text Box for Initiative
Description or
"Blippies"/Appropriation or Allocations Paragraphs: |
|
|
||||||||
|
||||||||||
Personal Services
Section: (Please
attach excel spreadsheet for detail estimate exported from BFMS system
to justify requested amount. Remember
that BFMS may not be updated for most recent salary and benefit rates. This can be compensated for by starting the
position a step higher than otherwise anticipated. Contact your budget analyst for help
producing an estimate thru BFMS.) |
||||||||||
Job Class Title |
Account # |
Leg. Count |
FTE Count |
2008-09 |
2009-10 |
2010-11 |
2011-12 |
2012-13 |
||
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||
Total - Personal
Services |
|
|
|
|
|
|
|
|||
All Other & Capital
Expenditure Information |
|
|
|
|
|
|
||||
Account # |
C&O Code |
|
|
2008-09 |
2009-10 |
2010-11 |
2011-12 |
2012-13 |
||
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total - All Other |
|
|
|
|
|
|
|
|
||
Total - Capital
Expenditures |
|
|
|
|
|
|
|
|||
Revenue Information: |
|
|
|
|
|
|
|
|
||
Account # |
C&O Code |
|
|
2008-09 |
2009-10 |
2010-11 |
2011-12 |
2012-13 |
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transfer Information: |
|
|
|
|
|
|
|
|
||
Account # |
C&O Code |
From Acct. # |
To Acct # |
2008-09 |
2009-10 |
2010-11 |
2011-12 |
2012-13 |
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Detail of Assumptions: |
|
|
|
|
|
|
|
|||
|
||||||||||