Gov. Chris Gregoire sets the stage for special session with an all-cuts budget.
Gov. Chris Gregoire held a press conference this morning setting the stage for the upcoming November 28 special session, when the legislature will be tasked with dealing with a $1.4 billion shortfall in the current $32 billion biennial budget.
Two footnotes on those numbers: 1) The state needs to find more than $1.4 billion in savings—the governor says $2 billion—because only saving $1.4 billion won’t leave any reserves in the budget. And 2) The state doesn’t actually have $32 billion to consider—64 percent of the budget is off-limits because of state and federal rules and mandates.
That leaves $8.7 billion in discretionary spending in four areas: Education (the biggest piece), social services, health care, and corrections. Despite her mantra that “everything’s on the table,” though, Gregoire has noted that she couldn’t release felons—”Protecting the public has to be one of our top priorities”—so other areas would have to take bigger cuts. With that major asterisk on the $8.7 billion, Gregoire released a “road map” this morning of $4 billion in possible cuts, of which she identified $2 billion she would support. Gregoire spokeswoman Karina Shagren said the $2 billion proposal was intended to “start the conversation.”
Asked repeatedly about revenue, Gregoire said: “I have not thought about revenue. I’ve spent my due diligence on an all cuts budget. Now, I will turn my attention [to other ideas]. I do not have any [revenue] ideas today. The question now is, these are what the cuts look like, now we have to ask ourselves do we want to look at alternatives of revenue, what might they be, and do we want to go there?”
She added, however, “first we must cut to get to the $2 billion.”
The press did not ask about the left’s go-to option—cutting from the $6 billion in tax loopholes, such as the $172.6 million loophole for big banks. However, when asked about the issue previously while saying “everything’s on the table,” she called the option “premature” and said the state first “has to come up with the $2 billion in cuts,” cautioning, “Someone has to show me the $2 billion—or $2 million, for that matter, [in tax loopholes] that I can pass in the legislature and in the court of public opinion.” Gregoire noted that every loophole has its constituency and cutting loopholes comes with the potential of “cutting jobs.” She said the legislature has to “make the word ‘jobs’ the driving force of the 2012 session.”
Here are some of the cuts Gregoire indicated will be in her final proposal to the legislature to kick off the special session:
Eliminate the Basic Health Plan, ending subsidized health care to 35,000 low-income individuals.
Cut off medical services to 21,000 people enrolled in the state’s Disability Lifeline and ADATSA (Alcoholism and Drug Abuse Treatment Support Act) programs.
Trim 15 percent from the support the state provides to colleges and universities.
Cut the length of supervision for all offenders, based on severity of offense. Sex offenders will be supervised for 24 months, and all other offenders, for 12 months.
And saying, “I can’t stand my education budget … a recession is not the time to cut education,” here are some of Gregoire’s suggested cuts to K-12 education nonetheless: reducing state levy equalization money to poorer school districts ($150 million); increase class sizes in grades 4-12 ($137 million); reduce teacher bonuses for 5,800 teachers ($8.4 million); and reduce high school staffing ($5 million).
Mary Lindquist, head of the state teachers’ union, the Washington Education Association, said of Gregoire’s opening gambit:
Enough is enough. We’ve already slashed more than $2 billion in funding from Washington’s public schools in the last few years. It’s clear we also need new revenue. Washington’s students need a quality education more than big businesses need tax breaks.
Anticipating Gregoire’s all-cuts approach, Our Economic Future, a coalition of health care, social service, and union groups—referring to themselves as “the 99 percent”— condemned the governor’s “road map” this morning.
And the lefty state budget watchdogs at the Washington State Budget & Policy Center issued this statement immediately after Gregoire’s press conference:
The plan rolled out by the Governor this morning is absolutely the wrong direction for Washington state. We cannot create jobs and get our economy back on track through deep cuts to education, health care, and social services. This one-sided, lopsided approach will do significant damage to the very things that make our state a good place to live, work, and do business.
Policymakers must take a balanced approach. We need to raise revenue now to address our immediate needs and make structural changes so that our revenue system is adequate and sustainable in the long-term. This includes eliminating ineffective tax breaks and temporarily increasing and permanently modernizing the state sales tax. In the long-term, we can enact a new tax on capital gains and strengthen our rainy day fund.
Budgets always require hard decisions, but a budget that cuts children, families, and older adults without any tax reform is not just a hard decision – it’s a bad decision.
Our state must make the public investments needed to create jobs and protect our communities. This cannot be done without additional revenue.
State Sen. Joseph Zarelli (R-18, Ridgefield), the ranking Republican on the senate ways and means committee, and the GOP’s go-to senator on the budget, issued this statement: “I agree with the governor when she says government cannot do it all. It will be up to the Legislature to decide what government should and should not be doing, and at what cost to taxpayers. We managed to accomplish that earlier this year, in a bipartisan manner, and that is my goal again.”
Editorializing for a second here (it’s hard not to), but doesn’t Gregoire’s earlier dismissal of closing loopholes (because they have constituencies and could eliminate jobs sound weird given that the cuts to education—class sizes, reducing high school staff—are also tied to constituencies and jobs?
Watch Gregoire’s press conference here.
