GOVERNOR ORDERS TIERED HOLDBACK
ASKS LEGISLATURE TO HOLD PUBLIC SCHOOLS HARMLESS

(BOISE) – Governor C.L. “Butch” Otter announced his plan today for addressing an estimated $151 million shortfall in this year’s state budget. It includes tiered spending holdbacks based on the nature of each agency’s mission and a request that the Legislature use a reserve account to avoid a reduction in public school funding.

“This is not an across-the-board holdback. My executive order distinguishes between the critical, constitutionally required, essential and other services of state government,” Governor Otter said. “This goes way beyond the difference between ‘necessary’ and ‘nice.’ It goes to the fundamental requirements and expectations that we have for state government.”

An agency-by-agency list of the ordered holdbacks is attached. They apply to most departments, agencies and institutions of the Executive Branch that report to the Governor and which draw support from the General Fund. Overall, the holdbacks represent 4 percent of the General Fund budget for Fiscal Year 2010.

The holdbacks do not apply to other funding sources, such as dedicated or federal funds. However, Idaho’s other constitutional officers and the court system agreed to join in the action. As with any holdback, the action taken today is temporary and must be acted upon by the Legislature when it reconvenes for its 2010 session in January.

The Governor also called on the Legislature when it returns to session to transfer almost $49.3 million from the Public Education Stabilization Fund (PESF) to the General Fund to cover the amount of money that would have been held back from public schools at the average rate used for the rest of state government.

Along with the holdbacks, that reserve fund transfer would address 65 percent of the expected budget shortfall for the fiscal year that runs through June 2010.

“Clearly, we need to do more. We must explore significant restructuring and find further budget savings. That’s why I’m launching a public dialogue with Idaho taxpayers, lawmakers, agency officials, state employees and other stakeholders on how best to achieve meaningful reorganization of state government,” Governor Otter said. “State government must live within the people’s means.”

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Budget Plan Holdback Chart

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