Although most states that suspended their scheduled sessions provided a planned date of return, many of these dates may be pushed further back if the pandemic continues to evolve, and state and federal guidance continues to encourage social distancing. With almost all states operating under mandatory stay-at-home orders per governors, additional states are likely to postpone or adjourn sine die in the coming weeks. The shuttering of state houses due to the COVID-19 response will likely have lasting impacts on state legislative priorities.

State Budgetary Implications

State budgets, which are normally some of the last bills to be finalized during sessions, have been left pending in many states. Almost all states must finalize their budgets by the beginning of the fiscal year on July 1, barring any extensions. In states with suspended sessions, legislators will have a shorter timeline for budget negotiations; states with 2021 budget agreements already in place will likely require adjustments or supplemental budget proposals in response to pandemic-related economic changes.

As of April 1, 19 state budgets were signed by the governor, 8 had been passed by the state’s legislature, and 24 were still pending in the legislature. The Missouri legislature chose to forgo enacting a new budget, even as their fiscal year begins in July, to reevaluate circumstances as the pandemic evolves.

Additionally, states may see a large loss of revenue from tax collection, with many small businesses, retail establishments, and restaurants closing their doors. This could cause state budgets to see deficits in 2021 and beyond.

Outlook for State Policy Priorities

State Medicaid expansion efforts have also been halted. In Kansas, Medicaid expansion legislation is on hold as the Senate adjourns before a “veto” session set for late April. Legislators in Wisconsin pushed for the state house to take up expansion legislation as late as early March, but the session has since been suspended due to COVID-19. Missouri and Oklahoma have active campaigns for ballot initiatives to be added to the November elections in their respective states, though social distancing has made it nearly impossible to seek out the required signatures.

States will likely respond to the eventual rising costs of COVID-19 treatment and prevention in Medicaid by shifting funding or enacting budget cuts elsewhere. Because of healthcare coverage losses due to rising unemployment, enrollment in Medicaid is expected to increase by the millions. At the same time, revenue is falling in the states, likely preventing legislators from being able to balance their state budgets.

Other legislative packages, from tax relief to statewide public healthcare options, have been paused. Many states will now have to devote the majority of their resources and budget surpluses to pandemic response efforts, leaving many state legislators with limited options to advance other legislative priorities.

Looking Ahead for 2020

It will be important to monitor how governors and legislators respond and adapt to these changes and whether any states adopt remote conferencing and voting procedures. Given the amount of pending legislation on hold in these suspended sessions, a likely path for most states may be to allow carry over of bills from this session into 2021, if sessions do not resume in the near term.

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