OLYMPIA — Gov. Chris Gregoire on Monday ordered state agencies to freeze hiring, curb out-of-state travel and cut back on fuel use amid another sign a weak economy is drying up tax collections.
New-equipment purchases will be reduced and the signing of personal service contracts severely limited under the directives from the governor to directors of those agencies under her control.
Gregoire also urged similar cutbacks to be taken on college campuses and by other statewide elected officials in their offices.
No layoffs are planned, and hiring already under way will be allowed to be completed. The directive covers about 1,900 vacant jobs for which the process of filling them has not begun.
Gregoire’s action could net $90 million in savings this budget year if carried out across all of state government and higher education. It was spurred by a new report showing tax collections in June came up nearly $61 million less than anticipated.
“We believe the response is more than adequate to the drop in June revenue receipts,” said Gregoire communications director Pearse Edwards.
Former Gov. Gary Locke ordered a similar freeze in 2002 when facing a potential budget deficit, he said.
State Sen. Mary Margaret Haugen, D-Camano Island, called the governor’s action “very prudent.”
“We need to not be hiring anybody until we get a good look at what our budget situation is,” Haugen said Monday.
At the moment, next year’s budget is expected to be far less rosy than the last three years.
Nonpartisan staff of the Senate Ways and Means Committee has predicted the state will have a $2.7 billion deficit at the end of the next biennium in June 2011.
Gregoire, a Democrat seeking a second term, has not acknowledged that figure in comments about next year’s budget.
But her Republican challenger, Dino Rossi, repeatedly cites that number on the campaign trail. Monday he stressed that the figure is the deficit even after 8 percent growth in revenues.
“This is nothing more than showmanship what she’s done today,” he said. “She’s still not admitting there really is a problem. It’s fiscally reckless at best.”
Gregoire blamed the slowdown on surging energy costs and a hobbled national economy. She said Washington is lucky to have about $800 million in reserves, including a hard-to-access “rainy day” fund.
“In spite of what is happening nationally, we have made real progress and I am not about to shortchange the future of our state,” Gregoire said in a statement. “These steps will put us in a better situation for the next budget.”
Glenn Kuper, communications director for the Office of Financial Management, said $62.8 million of the $90 million in projected savings would come from the hiring freeze and assumes colleges follow the governor’s lead.
An estimated 1,900 positions — 933 in general government and 1,018 in higher education institutions — would not be filled, Kuper said.
Of the remaining savings, $12 million would come from not making equipment purchases, $11 million from fewer personal service contracts, $3.2 million from reduced out-of-state travel and $1.2 million from a 5 percent cut in fuel consumption below 2007 levels.
Public safety and some health positions are exempt from the freeze, such as state troopers, prison guards and mental hospital staffers, Kuper said.
Reporter Jerry Cornfield: 360-352-8623 or jcornfield@heraldnet.com.
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