State Budget Practice Report Cards and Budget Resource Guide
Unlike many states, Georgia has funded its public employee pensions in line with actuaries’ recommendations for at least two decades. Its budgetary commitment to full funding helped the state average an A in legacy costs—which include pensions and other postemployment benefits (OPEB), principally health care—for fiscal 2017 through 2019.
Georgia’s pensions were funded at about 80 percent of estimated obligations in 2018, 10 percentage points above the total for all states. The state’s decision to start making full actuarially determined OPEB contributions also factored into its top mark in legacy costs; not doing so in 2016 had restricted its grade in the category to B for the previous three-year evaluation period.
In contrast to its performance in the legacy costs category, Georgia averaged a C in budget forecasting. The grade reflected the state’s failure to use the consensus method for revenue forecasting. Instead, estimates come from the executive branch via the state economist, who works with the governor and the executive Office of Planning and Budget. In addition, the state does not provide a detailed rationale to support revenue growth projections in the budget.
Despite these shortcomings, Georgia estimates expenditures for four years beyond the current fiscal year—in contrast to many states that look ahead for no more than three years. Georgia’s forecast also includes a brief narrative in the governor’s budget report explaining the basis of the estimate.
To emphasize the need for clear and comprehensible budgets to inform citizens, promote responsible policymaking, and improve fiscal stability, the Volcker Alliance in 2016 began a study of budgetary and financial reporting practices of all fifty states. The Volcker Alliance’s mission is to improve the effectiveness of the administration of government at all levels. Making state budgeting more transparent and accountable is an important part of that goal.
The report cards found here contain grades of the state's budgetary practices during the fiscal years of 2017 through 2019. Each state received marks in five critical categories, based on their adherence to best practices in several key budgeting indicators. The five categories covered methods used to achieve budgetary balance as well as how budgets and other financial information are disclosed to the public.
States received grades of A to D-minus (there are no “failed states”) for their procedures in estimating revenues and expenditures; their use of one-time actions to balance budgets; how they oversee and use rainy day funds and other fiscal reserves; the adequacy of their funding of public worker retirement and other postemployment benefits; and the quality of transparency of budget and related financial information. The grades are based on research conducted by public finance and budgeting professors and students at eight US schools of public administration or policy. The universities’ research efforts were augmented by Volcker Alliance staff, data consultants at Municipal Market Analytics, and special project consultants Katherine Barrett and Richard Greene.
State Budget Sources
State Budget Sources: An Annotated Guide to State Budgets, Financial Reports, and Fiscal Analyses is a resource published by the Volcker Alliance designed to help public officials, policy advocates, journalists, academics, and concerned citizens fully understand the critical fiscal decisions that governors and legislators must make. The guide includes the links below to budgets for this state as well as legislative analyses of budget bills and treasurers’ or comptrollers’ monthly state cash-flow statements; capital spending plans; reports on public-worker pension funding and returns; and reports by local and national fiscal research organizations, bond rating firms, and associations of state fiscal and finance officials.