Fiscal and Policy Analysis

 

The fiscal and policy analysis staff focuses on analyzing the Governor's operating and capital budgets, estimating the fiscal and economic impacts of proposed legislation, and providing additional support for the fiscal committees of the Senate and House.

 

During the annual session, staff is intensely involved with analyzing and reporting on the changes in the budget; identifying and evaluating new initiatives, programs, and policies; making recommendations; presenting findings before the budget committees; and preparing and processing the operating and capital budgets and supporting documentation.

 

Additionally, for each bill that is introduced, staff, as required by law, prepares a "fiscal note" that contains an estimate of the fiscal impact of the bill on the revenues and expenditures of State and local governments during the year in which the bill is to become effective and for the next four years following that year. If a bill imposes a mandate on a local government unit, the fiscal note also must contain a statement that identifies the imposition of the mandate, an estimate of the fiscal impact of the mandate, and, if applicable and if the data is available, the effect on local property tax rates.

 

As a part of each fiscal note, staff prepares an economic impact analysis for each bill to estimate the cost or economic benefit to small businesses and an economic impact analysis rating to estimate the economic impact on small businesses. Analyses and ratings must include estimates related to the following factors, as appropriate: cost of providing goods and services; effect on the workforce; effect on the cost of housing; efficiency in production and marketing; capital investment, taxation, competition, and economic development; and consumer choice.

 

Prior to the hearing on a bill, copies of the fiscal note are furnished to the sponsor of the bill and to the standing committee assigned the bill. Subsequently, if an amendment modifies the original estimate, a revised fiscal note is issued. Copies of fiscal notes are available from the Department of Legislative Services and on the MGA Web site.

 

Fiscal and policy analysis, including budget review, is a year-round process. Subsequent to the adoption of the State budget, other amendments are proposed which must be reviewed. In addition to the post-session review of budget amendments, the ongoing budget analysis process includes activities such as forecasting trends in the State budget, identifying significant financial policies of public agencies in the State budget, determining the fiscal impact of regulations, and conducting revenue and expenditure forecasts and sunset reviews.