State agencies that save some of their money rather than spend it all would be rewarded, under a bill passed overwhelmingly by the House.
Sponsored by Rep. Duane Quam (R-Byron), HF299 would allow 50 percent of agencies’ unspent funds to be carried forward and deposited into a special account. The savings could then be put toward programs of the agencies’ choosing.
Passed 120-7 by the House, it now goes to the Senate, where Sen. David Senjem (R-Rochester) is the sponsor.
The measure is designed to mitigate the so-called “Christmas in June” effect, where agencies with unspent funds are faced with the choice of either finding something to spend it on before the end of their two-year budget cycle or losing it the next time around.
The program would be known as the State Agency Value Initiative, or SAVI. Quam said he got the idea from community college employees who felt that spending money just for the sake of getting the same amount the next time around is wasteful.
The bill would also establish a “peer review panel” in each participating agency. The idea is to give agency employees a say in how the savings are spent.
Rep. Mary Kiffmeyer (R-Big Lake) praised the bill as a “practical way where our government employees can be fiscally conservative.”