Glossary(2001 Budget Document) Click on a term to jump down to the definition
Funding necessary to continue an agency's approved ongoing activities. The activity-based budget does not include significant changes in the way the agency provides services. The activity-based budget is developed at the beginning of each biennial budget cycle. See also"Biennium")
Any change to a previously enacted Appropriation Act. A change can be a modification of existing language or amount, addition of new language or amount, or deletion of existing language or amount. An amendment can be proposed by the Governor in the introduced Budget Bill. All amendments, whether proposed by the Governor or made by the General Assembly, must be adopted by the General Assembly before they can become law.
The amount of spending legally authorized by the General Assembly. Only the General Assembly can appropriate funds. The Governor, however, has certain statutory authority to increase, decrease, or transfer funds during the implementation of the budget. The Governor's authority to make such changes is contained in Part Four (General Provisions) of the Appropriation Act.
A two-year period used by the state for financial and budget purposes. It includes two fiscal years, running from July 1 in an even-numbered year to June 30 of the next even-numbered year. The current 2000-02 biennium, for example, began on July 1, 2000, and will end June 30, 2002. This budget document describes the Governor's proposed amendments to the 2000-02 biennial budget. (See also "Fiscal Year.")
The bill, submitted by the Governor to the presiding officer of each house in the General Assembly session held in an even-numbered year, contains the Governor's proposal for the biennial appropriations of the state's revenues and unexpended balances. In the odd-year session, the Governor submits a Budget Bill containing his proposed amendments to the Appropriation Act enacted in the prior even-numbered year.
The state has two types of budgets, an operating budget and a capital budget. The state's capital budget deals with large, non-recurring expenditures of funds to purchase, construct, or renovate fixed assets such as land, buildings, and other physical plants, or equipment costing more than $250,000 to construct or $500,000 to improve.
Examples are the construction of a building, renovations to a water supply system, or the installation of a new sewage system. A capital budget appropriation is limited to the cost of a project and may be expended over a long period until the project is completed. (See also "Operating budget.")
Central accounts adjustments
Some budgeted amounts may be placed for convenience in Central Appropriations, which acts as a central "holding account" for funds used to supplement state agency appropriations. These funds are designated for a variety of purposes, including employee compensation, economic contingencies, economic development, employee health insurance premiums, state legal expenses, and personal property tax relief. Central Appropriations also may be used for convenience as a "reversion clearing account" to accrue statewide savings for various actions.
Amounts placed in a central account must later be distributed to the individual agencies as amendments to the budget. A number of technical adjustments are included in the Governor's proposed amendments to the 2000-2002 budget to distribute amounts that were placed in a central account.
- the transfer of funding for the Virginia Plan for Equal Opportunity in State-Supported Institutions of Higher Education from Central Appropriations to the Secretary of Education,
- the transfer of funding for the state and local employee health benefits program to the Department of Human Resource Management,
- a reduction in the budgets of the Department s of Corrections and Juvenile Justice to capture savings from over-budgeted personnel costs,
- an adjustment to the budget of the Department of State Police to reflect a salary increase for State Police dispatchers.
- a transfer of nongeneral fund appropriation to institutions of higher education representing a portion of the annualized cost of the salary increase for classified employees which occurred on November 25, 2000,
- the capture of excess retirement dollars from K-12 teaching and support staff resulting from the reduction in retirement contribution rates for fiscal year 2001,
- the continuation of a premium holiday for the state automobile liability program,
- the implementation of a premium holiday for the state indemnity performance bond program,
- the capture of additional saving from reduced telecommunications rates as a result of a new state contract with MCI-Worldcom.
A position in the state's classified plan subject to the provisions of the Virginia Personnel Act and state personnel regulations.
Certain state officials and employees (listed in Section 2.1-116 of the Code of Virginia) are exempt from the act and serve at the pleasure of the Governor or other appointing authority. (See also "Position level," "Full-time equivalent," and "Wage employee.")
All long-term credit obligations of a state agency, whether or not backed by the full faith and credit of the Commonwealth, and all interest-bearing short-term obligations. Debt includes revenue bonds, general obligation bonds, notes, and interest-bearing warrants, but excludes loans that do not bear interest or amounts held in trust.
The major types of debt are referred to by the sections of Article X of the Virginia Constitution that authorized them:
Section 9(a) Debt. Debt incurred under Section 9(a) may be issued to meet emergencies, to redeem previous debt, or, on a short-term basis, to meet casual deficits in revenue or in anticipation of collection of revenues.
Section9(b) Debt. Debt incurred under Section 9(b) is long-term general obligation debt for capital projects. It must be authorized by a majority vote of each house of the General Assembly and approved in a referendum by the citizens of the Commonwealth. The source of funds for repaying this debt is general fund revenues of the Commonwealth.
Section 9(c) Debt. Debt incurred under Section 9(c) is long-term general obligation debt for revenue-producing capital projects. This debt is issued as "double barreled" bonds, which are backed by both the revenues of the projects and the full faith and credit of the Commonwealth. Issuance of Section 9(c) debt requires a two-thirds vote of each house of the General Assembly and certification by the Governor that net revenues will be sufficient to meet principal and interest payments on the debt. Should project revenues prove insufficient, the state's full faith and credit is pledged to repay the debt.
Section 9(d) Debt. Debt authorized under Section 9(d) is appropriation- and revenue-backed debt. It is considered nongeneral obligation debt, because it is not backed by the full faith and credit of the Commonwealth. The issuance of this debt is authorized by general law and may be repaid from a number of sources, including appropriations of general and nongeneral fund revenues by the General Assembly, revenues of self-supporting enterprise systems, or payments from local governments.
Executive Management Savings
"Executive management savings" is a program used for convenience to account for budget reductions. The Governor's proposed amendments to the 2000-02 biennial budget include across-the-board reductions to selected programs and activities within Executive Branch agencies as well as some reductions that are targeted to specific lower-priority programs and activities.
The calendar on which the state operates for financial and budget purposes. Virginia's fiscal year begins on July 1 and ends on June 30. The current fiscal year, 2001, began on July 1, 2000, and will continue until June 30, 2001. (See also "Biennium.")
For classified personnel, one FTE equals 2,080 hours worked in a year. Part-time
or part-year employees are factored according to the share of the full 2,080-hour
work year they are employed. A seasonal employee who works only 20 hours
per week for six months, for example, would count as 0.25 FTE.
FTE is also used to measure and express student enrollment and attendance at institutions of higher education. (See also "Classified position," "Position level," and "Wage employee.")
General fund (GF)
Revenues are deposited into the state's general fund if they are not designated for a particular purpose. General fund revenues are derived from general taxes paid by Virginia citizens and businesses, such as the corporate and personal income tax. Lottery profits are also a revenue source of the general fund. Slightly less than half of the state's revenues go into the general fund.
Because these revenues can be used for a variety of governmental programs, this is the fund that the Governor and General Assembly have the most discretion to spend.
Nongeneral funds (NGF)
Revenues are deposited into one of the state's nongeneral funds if law earmarks them for a specific purpose. For example, federal grants are mandated for specific programs or activities, and motor vehicle and gasoline taxes are dedicated for transportation programs. Another example of nongeneral fund revenue is student tuition and fees, which support higher education.
The state has two types of budgets, an operating budget and a capital budget. The operating budget shows spending related to the ongoing operations of the programs, services, and activities of state agencies. An operating budget appropriation is limited to the costs of operation during each year of a biennium.
Operating costs include such expenses as personal services (salaries and benefits for classified employees and hourly workers), contractual services, and supplies. These expenses are, for the most part, recurring costs of providing state services. (See also "Capital budget.")
The maximum number of full-time equivalent employees that a state agency is authorized to employ.
An agency's total number of employees may not exceed the position level unless specifically permitted by language in the Appropriation Act. However, an agency's actual employment at any given time may be less, since some positions may be vacant. Contractual or wage employees, which agencies use for tasks of limited duration or seasonal nature, are not counted in the position level. However, for institutions of higher education, position level includes adjunct faculty. (See also "Full-time equivalent", "Classified position", "Wage employee",)
In his proposed budget for the 2000-2002 biennium, Governor Gilmore recommended that state agencies find a total of $91.7 million in "productivity savings" during the biennium. It was his belief that, like the private sector, state government could improve the way it does business and provide better service to taxpayers by increasing use of technology and other efficiencies to achieve greater productivity. The 2000 General Assembly accepted the Governor's recommendation, and the $91.7 million in savings was included in a central account in the 2000 Appropriation Act.
All agencies of the Executive Branch, except institutions of higher education, were then asked to develop plans containing specific strategies to achieve productivity savings. Agencies generated hundreds of innovative strategies for increasing productivity and reducing the cost of government. As required by the 2000 Appropriation Act, Governor Gilmore presented these plans to the General Assembly in October 2000. Details of the productivity savings strategies for each agency can be found at dpb.virginia.gov/budget/00-02/finalreport.pdf.
In Governor Gilmore's proposed amendments to the 2000-02 budget, the $91.7 million in savings that was included in a central account is distributed to the individual agencies through specific amendments.
Virginia's budget is based on a program structure, a mechanism for conveniently and uniformly identifying and organizing the state's activities and services. Under this structure, services that the state provides are classified as items in descending levels as "programs" and "subprograms." A program is a distinct organization of resources by a state agency directed toward a specific objective such as developing or preserving a public resource, preventing or eliminating a public problem, improving or maintaining a condition affecting the public. (See also "Subprogram.")
A subprogram is a component or subdivision of a program. (See also "Program.")
Housekeeping adjustments to an agency budget that do not involve policy changes. Such adjustments include shifting funds between programs or subprograms, taking out one-time funding, annualizing partial-year funding, continuing increases in employee salaries into the next year, and changing rates for the state's share of employee benefits such as health insurance.
Some technical adjustments reflect amounts that are put in a central holding account for convenience during development of the biennial budget, and must later be distributed to the individual agencies as amendments to the budget. (See also "Central accounts adjustments")
Wage employee or
hourly position (P-14)
An employee working on a per-hour basis. Agencies are allowed to hire a wage employee for up to 1,500 hours within a year. Agencies generally use wage employees (called P-14 positions) for tasks of limited duration or seasonal nature. Wage employees are not eligible for most state fringe benefits such as health insurance, sick and annual leave, and so forth. (See also "Position level," "Classified position," and "Full-time equivalent.")