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Number 19
September 18, 2015

www.pacounties.org

LEGISLATIVE BULLETIN

An e-newsletter of the County Commissioners

Association of Pennsylvania

Serving Counties Since 1886

In This Issue

Republicans Introduce Stopgap Budget

Multiple Fall Deadlines Face Congress

Mental Health Reforms Introduced in Congress

DEP to Hold Listening Sessions on Clean Power Plan

NACO Submits Comments on Overtime Pay Proposal

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REPUBLICANS INTRODUCE STOPGAP BUDGET

As discussions continue regarding the FY 2015-2016 state budget, Republican lawmakers are looking at other options to release state monies during the impasse, including a short-term stopgap budget. In August, the House attempted to override 20 of the line items in the vetoed HB 1192, all of which failed to achieve the necessary 2/3 majority for approval. The Senate then announced that it would return to session Sept. 16, a week earlier than originally planned, to consider several bills that would provide four months of stopgap funding.

The stopgap measure, SB 1000, generally funds all line items in the state's General Fund at about 33 percent (a few are funded higher, including children and youth at about 50 percent), and would allow 100 percent of federal funds and state funds from dedicated sources, such as the Lottery Fund, to flow through. On Sept. 16, the Senate Appropriations Committee voted to report SB 1000, along party lines, with Republicans voting in favor and Democrats voting against. The committee also reported SB 1001, Fiscal Code amendments to implement the stopgap budget, along the same party line vote.

Unlike the House attempts to override line items in the vetoed HB 1192, the stopgap bills would need to be approved by simple majority in both chambers, then signed into law by the Governor like a traditional state budget. At the time the Bulletin went to press, the Senate was expected to bring SB 1000 and SB 1001 up for a final floor vote on Sept. 18, with the House expected to consider the bills the week of Sept. 21. However, Gov. Wolf has indicated that he would veto these stopgap budget bills.

In the meantime, Gov. Wolf rejected a late August counter-proposal offered by Republican legislative leaders to provide the full $400 million in basic education funding sought by the Governor, in return for changes they are seeking to the state and public school pension systems. The Governor in turn has offered his own counter-proposals to privatize wine and liquor sales by hiring a private manager to run the state system and to add a 401(k) component to the traditional pension benefit for future school and state employees. In exchange, the Governor is seeking the tax increases requested in his March proposal intended to address a long-term budget deficit and provide school property tax relief.

Counties remain committed to assuring that the commonwealth's most vulnerable citizens continue to receive critical human services during the budget impasse and are seeking appropriate state funding for these shared obligations. CCAP has been documenting the impacts of delayed state payments and resulting cash flow issues, which is available on the Budget News and Updates page of www.pacounties.org. Counties also continue to advocate for critical priorities, including taking any proposed rebalancing related to child welfare lines off the table and beginning a three-year restoration, consistent with the Governor's budget proposal, of the ten percent reduction to the seven line items that are part of the Human Services Block Grant and affect core services across all 67 counties.

MULTIPLE FALL DEADLINES FACE CONGRESS

Congress returned to Washington on Sept. 8 following its August recess, facing three critical deadlines before the end of 2015 to approve an appropriations package for FY2016, raise the debt ceiling and address the expiration of the federal surface transportation law.

Oct. 1 marks the beginning of the new federal fiscal year, and a government shutdown could occur if Congress and President Obama fail to come to an agreement on an appropriations package. While the House has passed six of 12 individual appropriations bills, the Senate has not yet passed any. Key disagreements remain between the chambers and both parties over defense spending, the removal of sequestration cuts and several other matters, and there has been speculation that Congress may consider a short-term measure to keep the government operational through early December as negotiations continue.

In addition, the third short-term extension of MAP-21, which funds surface transportation, is set to expire on Oct. 29. In late July, the Senate passed a six-year transportation bill that the House has not yet considered, and it has been reported that the House plans to develop its own transportation legislation that could then be sent to conference with the Senate. At the same time, the U.S. Department of Transportation said that it has enough funding to cover payments to states for transportation projects until June 2016, although Secretary Anthony Foxx noted that if Congress does not act to reauthorize MAP-21 before Oct. 29, it will prevent new obligations from the Highway and Transit programs and may affect reimbursements to states. Counties support a long-term transportation reauthorization bill; more information on county transportation priorities is available on NACo's Transportation Steering Committee website.

Finally, the Treasury Department estimates that it will reach the limit on government borrowing after October and thus the United States will default on its loans if Congress fails to raise the debt ceiling. Congress has voted to raise the debt ceiling multiple times since 2010, notably in 2013 after a two-week-long government shutdown. While the House Ways and Means Committee did approve legislation that would exempt payments on the nation's public debt and Social Security from the borrowing cap in mid-September, it is unclear at this time how Congressional leaders will resolve the debt ceiling crisis.

MENTAL HEALTH REFORMS INTRODUCED IN CONGRESS

Legislation introduced in Congress before the August recess would address mental illness in the criminal justice system, seeking to assist with both prison diversion and post-release treatment. CCAP has been examining the issue of inmates with mental health or substance abuse problems as a priority for two years. NACo has also joined with the Council of State Governments Justice Center and the American Psychiatric Association Foundation on a national initiative, Stepping Up, to help advance counties' efforts to reduce the number of adults with mental and substance use disorders in jails.

The Mental Health and Safe Communities Act (S. 2002), introduced by Sen. John Cornyn (R-TX), would reauthorize and expand the Mentally Ill Offender Treatment and Crime Reduction Act and its Justice and Mental Health Collaboration Program, through which states and counties design collaborative efforts between criminal justice and mental health systems such as jail diversion programs, and mental health and veterans courts. The Act would also amend the National Criminal Background Check System to clarify the scope of mental health records to be reported and provide financial incentives for states to share these records. Similar legislation to reauthorize the Act, without the background check provisions, was introduced in the Senate earlier in the spring.

Also in August, Sen. Chris Murphy (D-CT) and Sen. Bill Cassidy (R-LA) introduced S. 1945 to make critical reforms to the mental health system. The measure is a companion to legislation co-authored by Rep. Tim Murphy (R-PA), H.R. 2646. While the bills are similar, a key difference is that the House bill would provide incentives to states that implement assisted outpatient treatment programs, while the Senate version does not.

Although mental health reform bills have failed to gain traction in previous sessions, reports indicate that Rep. Fred Upton (R-MI), chair of the House Energy and Commerce Committee, has vowed to make this issue a priority and that lawmakers are optimistic that bipartisan consensus can be reached.

DEP TO HOLD LISTENING SESSIONS ON CLEAN POWER PLAN

The state Department of Environmental Protection (DEP) will be holding a series of listening sessions and a two-month comment period as Pennsylvania prepares its plan to comply with the federal Clean Power Plan. The Plan, released by the U.S. Environmental Protection Agency (EPA) on Aug. 3, sets carbon dioxide emission standards for power plants and establishes customized goals for states to reduce carbon dioxide. Under the federal Clean Air Act, each state is required to develop a state-specific compliance plan to meet individual state targets set by EPA or be subject to the Federal Plan.

More information about the Clean Power Plan and Pennsylvania's targets is available at www.dep.state.pa.us by clicking on the Climate Change button. The web page also contains the schedule for the listening sessions, which began Sept. 15, as well as a list of specific compliance-related questions on which DEP is soliciting comment. Comments will be accepted until Nov. 12 and may be submitted at www.ahs.dep.pa.gov or by email to ecomment@pa.gov .

NACO SUBMITS COMMENTS ON OVERTIME PAY PROPOSAL

In July, the U.S. Department of Labor (DOL) issued a proposed rule to update and revise the Fair Labor Standards Act's (FLSA) regulations to change the way employers implement exemptions from minimum wage and overtime pay for executive, administrative and professional employees.

Specifically, the proposed rule would increasethe salary threshold for employees exempt from overtime pay requirements from $23,660 to $50,440. The proposed rules are estimated to affect about five million workers nationwide, and the new overtime regulations would cover about 40 percent of the country's full-time salaried work force. NACo submitted comments to the DOL on the proposed rule, noting that it would have a large impact on county government budgets and administration, since the proposal would more than double the minimum salary level for an employee to qualify as exempt from the overtime pay rule. Further, NACo noted that most of the nation's counties are required to operate on a balanced budget and would not have the resources to cover or avoid expanded overtime without increasing taxes, reducing employee benefits, or reducing county employee work hours or staff. While the public comment period closed on Sept. 4, NACo requested extra time for counties to gather information and submit comments. Additional information is available on the NACo website.

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