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Budget Surplus Funds for CPA Still in Question

Posted on: October 31, 2019 - 11:50am

Over the past several years, the Coalition has been successful in advocating for state budget surplus funds to be transferred to the CPA Trust Fund. However, these funds are not always available, as you can see in our chart tracking the history of CPA Trust Fund distributions. Receiving budget surplus funds is a two-step process:

  • First, we have to advocate for those funds to be included in the state budget. We were successful in that effort for this year's budget - $20 million for CPA was included, the highest amount since 2013.
  • Secondly, the state Comptroller must close the books on the previous fiscal year and determine if a surplus actually exists. The statutory deadline for closing the state’s books is October 31st, which leaves time for any available surplus dollars to be transferred to the CPA Trust Fund prior to the November 15th distribution date.

Unfortunately, the state is going to be late in closing its books this year, perhaps significantly late. Why? The Comptroller can’t determine if there is a surplus until the legislature stops spending from the FY19 revenue. Unlike municipalities, the state can spend money from the previous fiscal year, even after the year has ended on June 30th. This year, the final FY19 spending bill is still caught up in negotiations between the House and Senate. Without a final spending bill, the Comptroller can’t determine if there is a surplus available for CPA.

What does this mean exactly for CPA communities? It's hard to say for sure, but until the House and Senate reconcile their final spending proposals for FY19, we won't know the status of the budget surplus funding. In 2018, this process was delayed for approximately a week, but the $10 million surplus funding for CPA was deposited in the CPA Trust Fund just in time for the November 15th distribution. Because these delays have continued for a longer period this year, it's seems as though communities will not receive the budget surplus dollars at the same time as their usual distribution from the CPA Trust Fund.

DOR has stated that while they are unable to pay-out any additional funds until the amount of the surplus has been finalized,  this delay will not affect the state match amounts based on solely the CPA Trust Fund. It’s unclear if DOR will be able to distribute the surplus money later in November, after the 15th, or if they would have to wait and include it in the November 2020 distribution. And of course, this is all contingent on the surplus funding being available at all, which we won't know until the comptroller is able to make their announcement. The Coalition will be closely monitoring the situation for further developments.

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