7/31/2019 PA Budget Balance Sheet

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House Appropriaons Com- miee (D)

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Understanding General Fund Financial StatementsBeginning BalanceEquals the ending balance from the previous year. Surplus funds that

were available at the end of the previous year because either the

money was not spent, not appropriated and/or revenues exceededthe ocial esmate at the end of the previous year. The 2011/12scal year began with a large beginning balance partly becauserevenues were $785.5 million above esmate at the end of 2010/11,and Gov. Corbe required spending freezes of $181.5 million in the

2010/11 scal year.

Adjustment to Beginning BalanceAdded to beginning balance. Represents changes thathappen aer the books were closed for the year and

interest earned on surplus money.

Revenue EsmateOcial revenue esmate provided by the

governor, which is updated at the beginning of the

scal year. The 2012/13 esmate includesstatutory changes enacted in the Tax Code bill (Act85/HB 761) and Fiscal Code (Act 87/SB 1263). Thenet eect of those changes in 2012/13 is a revenueincrease of approximately $10 million resulngfrom an esmated $90 million loss in the Tax Code(mostly due to tax credit programs) and anincrease in revenue of $100 million in the Fiscal

Code for enhanced revenue collecons.

Adjustment to 2011/12 EsmateAdded or subtracted from Revenue Esmate.Represents the dierence between actual revenues at

year end and the ocial revenue esmate produced atthe beginning of the scal year. In other words, how far

above or below esmate revenue is at the end of theyear. When the Governors Execuve Budget wasreleased in February he esmated this number to beapproximately $719 million below esmate. Eventhough actual revenues were below esmated revenues($162.8 million), the actual revenues were sll higherthan the previous year.

Ending BalanceEquals Preliminary Balance minus any transfer to the Rainy Day Fund. Thisamount is carried forward to the next scal year as the beginning balance.

Refund ReservesSubtracted from Subtotal Revenue. Represents the amount

kept as a reserve to pay refunds to taxpayers who paidmore taxes than they owed and who receive a paymentfrom the commonwealth when they le their tax returns.

Current Year LapsesThis represents money that was appropriated but not spent during the same year. Typicallythis is a result of agencies not being able to use all of their appropriaons. Recently this has

changed such that current year lapses represent budgetary freezes ordered by the governor.In January 2012 Gov. Corbe required agencies under his jurisdicon to freeze spending in

specied areas, not allowing them to ulize the full budgeted appropriaon. This money issubtracted from expenditures, reducing the amount spent in the 2011/12 scal year to allowmoney to roll over for the next year to begin with a more favorable beginning balance.

Prior Year LapsesAppropriaons or execuve authorizaons that went unspent in

the prior year are carried forward and are added to available

revenue to be spent in the subsequent year.

Funds AvailableEquals Total Revenue plus Prior Year Lapses. This is the amount ofstate General Fund money that is available to be spent as appropria-

ons or execuve authorizaons.

Transfer to Budget Stabilizaon Fund (Rainy Day Fund)This represents the 25% transfer to the Rainy Day Fund that is re-

quired by statute in the Fiscal Code and is calculated as 25% of the

Preliminary Balance.Act 87/SB 1263 of 2012 suspended the transfefor the 2011/12 scal year. The transfer would have been $164.7

million in 2011/12 if the transfer had not been suspended.

Preliminary BalanceEquals Funds Available minus Total Expenditures. This is theamount le on the table so to speak, which could have been

used for addional appropriaons ($659.1 million in the 2012/13scal year).

Supplemental AppropriaonsSpending that occurred in the 2011/12 scal year that was higher thanthe amount appropriated requires an appropriaon in the 2012/13

appropriaons act. Supplemental appropriaons are typically associatedwith mandated educaon or public welfare programs where caseloaddemands aect costs that cannot be predicted at the me the budget isenacted. This amount is added to expenditures.

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