What is a structural deficit and how does it impact our budget?
At the end of fiscal 2008, the university’s fund balance was approximately $62 million, while planning units had remaining spending authorization of approximately $75 million. The remaining spending authority, also known as the carry-forward budget, represents unspent budget authority accumulated over multiple years. This difference between the carry-forward spending authority and the fund balance resources to support it is referred to as the structural deficit. At the end of fiscal 2008, the university’s structural deficit was $13 million — the difference between the fund balance and the carry-forward authority granted to planning units. This structural deficit would become a real deficit if planning units used all of their spending authority within a fiscal year.
Related Questions
- How is a structural deficit different from an annual operating budget deficit that we would experience if we did not reduce spending to make up for state funding cuts and investment losses?
- What policies should the state enact to address the continued structural state budget deficit?
- How Did The Structural Budget Deficit Happen?
