No delays, no gimmicks
Published 12:01 am Sunday, March 20, 2011
Last week’s state revenue forecast defined the size of the budget gap legislators must close. Now it’s decision time.
The gap between projected spending and revenues through mid-2013 grew by a net $500 million, which actually was substantially lower than some estimates. Still, billions of dollars must be eliminated from social services, education, public safety and other priorities. That can’t be done without pain.
Delaying the inevitable won’t help. For the good of all who will be affected by the cuts to come, and the economic benefits a measure of budget certainty will bring, lawmakers must commit themselves to meeting their April 23 deadline for adjournment.
And the budget they adopt must be free of accounting gimmicks. Ideas that have been floated to help the short-term picture — borrowing against future revenues, creating a 25th month in the two-year budget, leaving the budget unbalanced — are irresponsible because they not only delay the inevitable, they make things worse.
Borrowing is no option for a state that already ranks eighth in the nation in per-capita debt. As a percentage of the general fund, state debt payments for bonds have almost doubled since 1989. They’re currently $1.8 billion per biennium — 6 percent of general fund spending.
Going deeper into debt not only limits the range of future options, it jeopardizes the state’s AA-plus bond rating. A lower rating would mean higher debt costs not just for the state, but for local governments and school districts. Kicking the fiscal can further down the road simply cannot be an option.
Putting off hard decisions in hopes that the June revenue forecast will be better would be foolhardy, too. The projected trajectory of the economic recovery remains low, and with new uncertainties around gas prices and the natural and nuclear disasters in Japan, there’s no reason to believe that outlook will improve soon.
It’s time to get real, painful as that will be. Tax increases are a political impossibility, so the discussion must focus on cuts and, importantly, reforms that can help put future budgeting on a more sustainable path.
Reforms to adopt include Gov. Chris Gregoire’s proposal to end automatic increases in Plan I pensions, and a constitutional amendment proposed by state Treasurer Jim McIntire requiring unfunded pension liabilities be paid off and other pension funds remain properly funded going forward.
The short-term budget picture isn’t going to get better. The only responsible choice, especially for our children’s economic future, is to step up, address it squarely and adopt a clean, balanced budget by April 23.
