Published: Thursday, February 19, 2009
Governor signs first wave of deep cuts to state programs
OLYMPIA -- Gov. Chris Gregoire signed new laws Wednesday shaving hundreds of millions of dollars in government spending then warned more cuts are coming because of a looming budget deficit.
How deep those reductions will be should become clearer today with the much-anticipated release of a new economic forecast.
The bipartisan Economic and Revenue Forecast Council will receive the report at its 4:30 p.m. meeting.
After months of declining tax revenues, most in Olympia, including the governor, expect the findings will project a deficit for the 2009-11 budget far greater than the $5.7 billion figure Gregoire relied on for her proposed budget issued in December.
She cautioned that while today's report will contain "more bad news," it will also be a prediction based on incomplete information.
It won't account for the increased costs of greater numbers of students, prisoners and those seeking state-subsidized health care. Nor will it add in money from the federal stimulus package or subtract the spending cuts enacted into law with her signature Wednesday.
Those trims total about $635 million from the current budget year, which ends June 30. Most of those are from the general fund used to run most government operations.
"This leaves us in a better position to address the significant shortfall we expect in the coming months," Gregoire said upon signing House Bill 1694 and Senate Bill 5640.
The new laws freeze hiring and wages and ban most travel and equipment purchases greater than $5,000 in every state agency as well as the legislative, judicial and executive branches.
There is an across-the-board reduction for most departments, a slice that means, for example, fewer dollars to help convicted offenders re-enter communities and less support for the Retired Senior Volunteer Program, one of the state's largest volunteer programs for people aged 55 and over.
Other savings come from delaying the start of two popular Democratic initiatives -- paid family leave and a tax credit for working families.
Some of the lost dollars will be made up with the use of $347 million in federal aid, of which $215 million in Medicaid money is from the just-signed federal stimulus package.
Gregoire said federal money will help but not solve the immediate and future budget problems. So, too, will the estimated $430 million in the rainy-day emergency reserve created by voters last years.
"We're not California and we're not Kansas," she said, referring to two states imperiled by staggering budget shortfalls. "We're determined we're going to end up in the black."
Jerry Cornfield: 360-352-8623, jcornfield@heraldnet.com.
How deep those reductions will be should become clearer today with the much-anticipated release of a new economic forecast.
The bipartisan Economic and Revenue Forecast Council will receive the report at its 4:30 p.m. meeting.
After months of declining tax revenues, most in Olympia, including the governor, expect the findings will project a deficit for the 2009-11 budget far greater than the $5.7 billion figure Gregoire relied on for her proposed budget issued in December.
She cautioned that while today's report will contain "more bad news," it will also be a prediction based on incomplete information.
It won't account for the increased costs of greater numbers of students, prisoners and those seeking state-subsidized health care. Nor will it add in money from the federal stimulus package or subtract the spending cuts enacted into law with her signature Wednesday.
Those trims total about $635 million from the current budget year, which ends June 30. Most of those are from the general fund used to run most government operations.
"This leaves us in a better position to address the significant shortfall we expect in the coming months," Gregoire said upon signing House Bill 1694 and Senate Bill 5640.
The new laws freeze hiring and wages and ban most travel and equipment purchases greater than $5,000 in every state agency as well as the legislative, judicial and executive branches.
There is an across-the-board reduction for most departments, a slice that means, for example, fewer dollars to help convicted offenders re-enter communities and less support for the Retired Senior Volunteer Program, one of the state's largest volunteer programs for people aged 55 and over.
Other savings come from delaying the start of two popular Democratic initiatives -- paid family leave and a tax credit for working families.
Some of the lost dollars will be made up with the use of $347 million in federal aid, of which $215 million in Medicaid money is from the just-signed federal stimulus package.
Gregoire said federal money will help but not solve the immediate and future budget problems. So, too, will the estimated $430 million in the rainy-day emergency reserve created by voters last years.
"We're not California and we're not Kansas," she said, referring to two states imperiled by staggering budget shortfalls. "We're determined we're going to end up in the black."
Jerry Cornfield: 360-352-8623, jcornfield@heraldnet.com.
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