House Approves its Budget Version
Senate now to approve..

With a vote just before midnight on (Friday pm) and another vote just after midnight (Saturday Am ) the House approved its version of the budget.  It now goes to the Senate and they will fail to concur and both Houses will appoint conferees to settle the differences which are many.  The revenue projections were very different where the Senate passed this budget. The House had considerable more short-fall to deal with.  They eventually decided to deal with the huge short fall with a combination of large cuts and some additional revenue.  The highlights of the House version are:

• Increase Revenue
• Income Tax Increase- will make available $ 257 M Current rate on all income greater than $100,000 is 7.75%.  The approved rate is 8.25% for income of $200,000-500,000.  Income more than $500,000 rate goes to 8.5%.
• Increase the sales tax .25 cent produces $195 M
•  Expand the Franchise Tax on limited liabilities companies $59M
• Require corporations that operate in multiple states to file tax returns sharing their activities in all states. $18.5M
• Sales tax on warranties, installations, repairs (including maintenance) $176 M
•  Sales Tax on Courier Services- $25M
• Sales Tax on Amusements/Movies- $24 M
• Modify Corporate Income tax formula $6M
• Change Bank Interest Deduction- $2.6 M
• Increase Liquor tax by 1.5%- $8M

What the additional revenue will restore

• 2,590 K-3 Teacher Jobs- $139 M

Original proposal would increase class size by two and result in 6000+ loss of teacher positions.  Proposal adopted will keep teacher allotments the same in grades K-3 as last year.  Grades 4-12 will be increased by 2 students.

• Restores 350 Instructional support positions. $19.4 M Keeps same allocation as 1 positions per 198 ADM
• Restores 350 Principal and Assistant Principal jobs $17.6 M
• Restores allotment for At-Risk students- $70 M
• Restores Money for low wealth counties- $4.8M
• Restores flexibility to local education agencies- $2.9 M

The additional revenue also restores many appropriations for the university system and community colleges.  It does the same for Health and Human Services, Justice and Public Safety, and Natural and Economic Resources.

The House budget still has lots of cuts in education. They include:

• Increase in class size by 2 students in grades 4-high school. Cuts $184M.
• Eliminates 200 literacy couches- $12 M
• Eliminates funding for teacher assistants $130 M
• Reduces the Driver training allocation by $1.1 M
• Eliminates funding for ABC bonuses $90 M
• Cuts funding for More at Four by $10M
• No salary increase- not even the step increase that was in the Senate budget.

Once again, this is far from final.  Not only will it have to go to the Senate and House Conference Committee, it will also have to be approved by the Governor.