OFFICE OF FISCAL ANALYSIS

Legislative Office Building, Room 5200

Hartford, CT 06106 (860) 240-0200

http://www.cga.ct.gov/ofa

sHB-5171

AN ACT PROHIBITING THE EXECUTIVE BRANCH FROM MAKING RESCISSIONS OR OTHER REDUCTIONS TO THE EDUCATION COST SHARING GRANT DURING THE FISCAL YEAR.

As Amended by House "A" (LCO 4585)

House Calendar No.: 113

Senate Calendar No.: 496


OFA Fiscal Note

State Impact:

Agency Affected

Fund-Effect

FY 19 $

FY 20 $

Education, Dept.

GF - See Below

See Below

None

Various State Agencies

GF - See Below

See Below

None

Note: GF=General Fund

Municipal Impact:

Municipalities

Effect

FY 19 $

FY 20 $

All Municipalities

See Below

See Below

None

Explanation

The bill prevents holdbacks and other executive branch reductions to the Education Cost Sharing (ECS) grant in FY 19. The bill requires the executive branch to fund ECS at the level required in the biennial budget's ECS formula, which for FY 19 is approximately $2.014 billion.

In the absence of the bill, the ECS grant may experience holdbacks and other reductions in FY 19. The biennial budget includes FY 19 targeted savings, municipal aid savings, and unallocated lapses totaling approximately $220.1 million. The bill will result in the executive branch taking the savings and unallocated lapses from non-ECS accounts, which may impact various state agencies and municipalities (see below).

In FY 18, ECS holdbacks and other midyear reductions totaled approximately $58 million of an estimated $166.6 million in unallocated lapses, targeted savings, and municipal aid savings. The ECS reductions resulted in a revenue loss for every municipality.

The bill will prevent an ECS revenue loss for municipalities in FY 19. It is anticipated that other municipal aid may be reduced in lieu of ECS reductions in FY 19. The impact on a municipality will depend on how the other municipal aid reductions are distributed.

The bill does not have a fiscal impact to the state or municipalities in FY 20, as the provisions that extend beyond FY 19 are clarifications of existing law regarding ECS grants and reductions to agency allotments and agency requisitions.

House “A” strikes the underlying bill, which had no fiscal impact, and replaces it with the impact described above.

The Out Years

As described above, the bill does not have a fiscal impact to the state or municipalities in FY 20 or beyond.

The preceding Fiscal Impact statement is prepared for the benefit of the members of the General Assembly, solely for the purposes of information, summarization and explanation and does not represent the intent of the General Assembly or either chamber thereof for any purpose. In general, fiscal impacts are based upon a variety of informational sources, including the analyst's professional knowledge. Whenever applicable, agency data is consulted as part of the analysis, however final products do not necessarily reflect an assessment from any specific department.