State Budget Practice Report Cards and Budget Resource Guide
Georgia was one of only ten states to garner a top grade of A for the handling of legacy costs in both fiscal 2017 and 2018. The increase from its C in 2016 gave the state an average of B for the three years.
The state’s overhaul of funding practices for other postemployment benefits (OPEB) for public workers, notably health care, drove the improvement. Georgia’s 2015 evaluation showed minimal assets for school or other state OPEB funds, leaving it with an unfunded liability of nearly $14 billion. The state began to prefund OPEB in fiscal 2016, and its contributions matched actuarially determined amounts in fiscal 2017. While this indicates progress, Georgia has not instituted statutory policies committing it to continue contributing at levels that will lead to a fully funded OPEB trust in the long term.
In pensions, Georgia made its actuarially determined contribution and set aside 79.2 percent of the assets needed to meet promised benefits as of 2017, almost 11 percentage points above the US average. Georgia also stood out for its avoidance of budget maneuvers to balance its budget in 2016, 2017, and 2018, earning an A average in that category. The state did not defer recurring expenditures, shift revenues into the general fund from special funds, fund recurring expenditures with debt, or use asset sales in any of those three years.
By contrast, Georgia’s three-year average of C in budget forecasting reflects its reluctance to use consensus revenue forecasting. Instead, the governor appoints a state economist to help prepare revenue estimates. Although consensus forecasting does not necessarily produce more accurate forecasts, it provides a more transparent and collaborative process.
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 2016 through 2018. 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.