LITTLE ROCK — A legislative panel endorsed a bill Friday that sets out a $5 billion state budget for the fiscal year that begins July 1.

LITTLE ROCK — A legislative panel endorsed a bill Friday that sets out a $5 billion state budget for the fiscal year that begins July 1.

The Joint Budget Committee’s recommendation of the bill, known as the Revenue Stabilization Act, clears the way for the House and Senate to take up identical versions of the bill next week and complete the work of the state’s third fiscal session, which began Feb. 10.

The budget bill largely mirrors the proposed budget that Gov. Mike Beebe presented in January. It calls for a $108 million increase in state spending, with $65 million of the increase going to public schools.

A day earlier, the Joint Budget Committee approved a plan to spend nearly $22 million of the state’s $125 million budget surplus.

One way that the budget bill differs from Beebe’s proposed budget is in the amount is sets aside for the state’s "rainy day fund." The measure approved by the budget panel calls for $19 million to go the fund, or $9 million more than Beebe had proposed.

Of that additional $9 million, legislators propose setting aside $7 million that Beebe had proposed in funding for the University of Arkansas for Medical Sciences and $2 million that the governor had proposed in funding for community health centers.

Legislative leaders said the money would be available to those entities, but they would have to demonstrate need.

"They basically have to make their case in the next fiscal year for why they need that funding, so the rainy day mechanism requires them to come to Legislative Council for approval on that money," Rep. Duncan Baird, R-Lowell, co-chairman of the Joint Budget Committee, told reporters.

Sen. Larry Teague, D-Nashville, the committee’s other co-chair, said that now that the Legislature has approved a new appropriation of federal funding for the private option, UAMS and the community health centers are projected to see a reduction in uncompensated care costs.

The private option is the state program, created last year, that uses federal Medicaid money to subsidize private health insurance for people earning up to 138 percent of the federal poverty level. The debate over whether to continue funding the program dominated this year’s fiscal session.

"I think we hope that the cost won’t be as high because of the private option and some of those things," Teague said. "They may not need the money. But if they need the money, we want it to be there for them."

Beebe said he did not object to the Legislature’s proposal to put the money in the rainy day fund instead of simply giving it to UAMS and the health centers as increased funding. Beebe said the entities will still be able to get the money if they need it and noted, "It’s the same amount of money."

The budget also includes a $3.1 million increase for the state Department of Correction, a $7 million increase in reimbursement to county jails for housing state inmates and a $5.2 million increase to fund a 1 percent cost-of-living adjustment for state employees.

The House and Senate are scheduled to meet next on Tuesday. House Speaker Davy Carter, R-Cabot, told House members Friday that the business of the session could be completed on Wednesday if everything goes smoothly.

"Hopefully that’ll get the plane landed," he said.