Honorable Jim Pitts, Chair, House Committee on Appropriations
FROM:
Ursula Parks, Director, Legislative Budget Board
IN RE:
HB1025 by Pitts (relating to making supplemental appropriations and reductions in appropriations and giving direction and adjustment authority regarding appropriations.), Committee Report 1st House, Substituted
HB 1025 Committee Report 1st House, Substituted, would appropriate $874.9 million from All Funds sources during the 2012-13 biennium. As required under House Rule 4, Section 34 (a-1), the Legislative Budget Board has analyzed the dynamic economic impact of the bill. The effects on employment, personal income, GSP, and other economic variables, assuming appropriation levels under CSHB 1025, were analyzed using the REMI Policy Insight Model, a dynamic forecasting and policy analysis tool that applies a combination of econometric, input-output, and computable general equilibrium methodologies
The analysis reflects the predicted effects on the number of state employees and the impact on private sector employment as a result of the adjusted appropriation levels in CSHB 1025 relative to a baseline scenario where 2012-13 appropriations were held constant at previously adopted 2012-13 levels. It is important to note that the numbers are not all new jobs; rather they are changes in employment levels relative to a scenario where government spending remained constant at previously appropriated 2012-13. The changes in employment levels would be achieved through some combination of additional hiring and cancelation of intended layoffs. Further, note that the employment concept used in the analysis is non-farm payroll employment calculated by the U.S. Bureau of Labor Statistics from the Current Employment Survey and differs from state FTE levels used in the General Appropriations Act. For instance, two halftime workers would be counted as 1 FTE in the GAA, but two jobs in the CES. The increased state expenditures in the 2012-13 biennium are expected to avoid employment reductions and increase private sector employment levels by 6,205 in 2013 over the constant spending growth scenario, while simultaneously avoiding employment reductions and increasing state employment by 7,417 in 2013 over the constant spending growth scenario, subject to the caveats identified above.