As work continues at the capitol following the recent resumption of the 2020 legislative session, the focus is beginning to shift to the state budget.
There’s no doubt that the COVID-19 pandemic has had a substantial impact on Mississippi’s economy. During an appearance on the Gallo Show this morning, Speaker of the House Philip Gunn discussed what that means for the final days of FY2020 and the upcoming FY2021.
The Speaker stated that before the pandemic hit, Mississippi was over $200 million above projections for the current fiscal year which ends on June 30. However, a drop of $245 million in April “wiped out all of the gains we had made.” While revenue numbers were still down, the month of May wasn’t as bad as originally thought. Overall, Gunn explained that Mississippi will likely end FY2020 around $47 million short.
Gunn said lawmakers will have to find funds to cover those losses, and one solution could be pulling from Mississippi’s ‘rainy day’ fund. Heading into the pandemic, the fund was maxed out at $550 million, which Gunn says is the result of fiscal responsibility by state leaders in recent years.
As for FY2021, the Legislative Budget Committee adopted a revised recommendation from the Revenue Estimating Group which puts the state $107 million down entering the new fiscal year. While drawing up the budget, Gunn said that some cuts will likely have to be made.
“The budget will involve cuts for next year. At the front end of the fiscal year, we can do that. We can reduce everyone’s budget and say ‘hey, you don’t have as much money as you have had in the past, y’all are going to have to tighten your belt’,” Gunn said.
Speaker Gunn went on to say that the agencies that he has spoken with are confident that they’ll be able to absorb the current projected shortfall.
During the remainder of the interview, Gunn discussed small business relief efforts, the potential uses for Mississippi’s remaining $900 million of CARES Act funding and the state flag.