On Tuesday, July 18, Senate Republicans introduced their 2017-19 state budget proposal. The proposal includes the actions of the Joint Committee on Finance (JCF), with minor exceptions, as well as their caucus proposals on all other items not yet addressed by the JCF including K-12 education, general fund taxes, and transportation. Many items proposed by the Senate Republicans impact counties. The following list highlights some of those proposals:

County Land and Water Conservation Staffing Grants: The Senate proposal provides an additional $900,000 nonpoint SEG annually for county conservation staffing grants, for a total of $5,936,900 nonpoint SEG and $3,027,200 GPR annually. Funding would be provided on an annual basis.

Farmland Preservation Planning Grants: The Senate proposal repeals the June 30, 2016 sunset of the farmland preservation planning grant program, and deletes $164,200 GPR annually to reflect anticipated grant demand in the 2017-19 biennium. The provision eliminates the sunset to make grants permanent, and provides $210,000 GPR annually.

Sales Tax Holiday in August: The Senate proposal deletes the Governor's recommendation to exempt from the state general sales and use tax certain school supplies purchased during the two-day period beginning the first Saturday in August and ending on the following Sunday.

Managed Forest Law Closed Acreage Fees and Timber Severance Taxes: The Senate proposal specifies that managed forest law (MFL) closed acreage fee payments be retained by municipalities and counties rather than deposited in the forestry account, and deletes required payments by DNR to municipalities containing land designated as closed under the MFL program. In addition, the Senate proposal requires the DNR to determine whether the amount in closed acreage fees payable to each county and municipality is less than the amount each received in severance and yield taxes in 2015, and for each county and municipality that will receive at least $2,000 less in 2018 than it received in 2015, requires the DNR to pay an amount equal to the difference between the two amounts, no later than March 1, 2018. The Senate provided $114,000 in FY18 for these payments.

Aquatic Invasive Species Education and Control Grants: The Senate proposal provides $1,000,000 conservation SEG (water resources account) in FY18 in one-time funds for aquatic invasive species education and control grants.

Personal Property Tax Exemption: The Senate proposal exempts watercraft, machinery, tools, patterns, furniture, fixtures, and equipment from the property tax, and classifies certain items that are currently assessed as personal property, but which have characteristics similar to real property, as real property, effective with property assessed as of January 1, 2018. The proposal creates a state aid program administered by DOR to make annual payments to each local jurisdiction that imposed property taxes on personal property in 2017, and sets each jurisdiction's payment equal to the amount of property taxes levied by the jurisdiction in 2017(18) on property exempt under this provision, beginning in May 2019. The Senate estimates the amount of the aid payment at $239,200,000 GPR in FY19. The Senate proposal also makes technical modifications to current law provisions related to local fiscal controls and the manufacturing and agriculture credit.

Federal Aid/State Funding "SWAP" Bill: The Senate proposal includes the provisions of 2017 Senate Bill 217 ("swap" bill), which would exchange federal aid and state funding among state and local highway programs. Under the proposal, sequential funding transfers would occur over a three-year period beginning FY19, such that by FY21, the surface transportation program (STP) would be entirely state (SEG) funded using transferred moneys from the state highway rehabilitation program. In each year, the proposed transfer of SEG funding to the STP program would be offset by transferring the same amounts of that program's existing federal (FED) funding into the state highway rehabilitation program.

Repeal Implements of Husbandry Sunset Provisions: The Senate proposal eliminates the January 1, 2020 sunset provisions related to weight allowances and permitting provisions applicable to implements of husbandry and agricultural commercial motor vehicles.

Public Library System Aid: The Senate proposal deletes current law requiring DPI to include in its biennial budget submission a request for public library system aid equal to 13% of the prior year operating expenditures from local and county sources.

Municipal Levy Limit Referenda: The Senate proposal requires the language of a municipal levy limit referendum to include language identifying the specific purpose for which the additional funds levied would be used.

Additional information on the Senate's proposal can be accessed here.

The release of the Senate proposal does not mean the Assembly and Senate are any closer on reaching a budget compromise. It appears the houses are still at odds over funding for transportation (raising revenue v. bonding).