Imagine this: you’re sitting at the kitchen table paying your bills and balancing your checkbook when you experience a pleasant surprise. You’ve got more money than you thought. A lot more. Of course, if you’re like many of us, you really have to use your imagination because this doesn’t happen in real life. But let’s pretend it does. So what do you do with all the extra money? Do you put it in savings? Pay off debts? Donate it to charity? Or maybe you decide to go out for pie?
The state of Idaho experienced a surprise at the end of the 2015 fiscal year when our tax revenues exceeded projections by $108 million. But rather than turn the Gem State into the pie capital of the world, the state, as required by law, distributed the revenue into two funds.
Half of the surplus was transferred to something called the budget stabilization fund (also known as the rainy day fund), and the other 50% was allocated to transportation infrastructure projects. Because of this, $54.1 million of the surplus was added to $95 million for transportation funding approved earlier in the year by lawmakers. The mechanism for these transfers is this month’s wonky word: Surplus Eliminator.
The surplus eliminator, despite sounding like the name of a super hero in a budgetary comic book (if there were such a thing), was born during the waning hours of the 2015 legislative session. The session wrapped up after midnight with the passage of a transportation funding bill. House Bill 312 bill sought to address a long-term shortfall in transportation funding by raising the tax on gas by 7 cents per gallon, raising vehicle registration fees, and instituting a fee for use of electric and hybrid vehicles. House Bill 312 was a compromise bill and many observers felt it did not go far enough in addressing the 750 deteriorating bridges and up to 25,000 miles of Idaho pavement deemed in need of restoration, while others thought it went too far. Many agreed that after midnight on the last day of session is a less-than-ideal time to pass such an important expenditure bill.
We don’t find extra money in our checking account every day or in our state coffers every year. So it is up for debate how advisable it is to depend on a surplus eliminator to take care of the things we need but didn’t adequately cover in our budget. In any case, even if the amount of money allocated for transportation is partly determined by how incorrect
the budget projections are, the surplus eliminator is being put to work repairing Idaho’s roads and bridges. So that's something to think about next time you’re driving to your favorite restaurant for a slice of pie.