For the past two weeks the Georgia State Legislature has been taking a working recess in order to address our current budget crisis. At issue are both the FiscalYear 2010 amended and the FY 2011 General budgets.
During this time, Senate and House appropriation members have been holding joint budget hearings to work through the deficits and find over $1 billion in additional cuts. This is in addition to the nearly $4 billion in cuts that have already been made since 2008.
Currently, the most pressing issue is the FY 2010 amended budget that runs through June of this year.
In early January, Governor Sonny Perdue submitted an amended budget of $17.4 billion based on the assumption that revenues for the remaining six months would be the same as they were this time last year. When January’s revenues came in $137 million down from a year ago, this assumption was proven wrong.
It is now believed that the adjusted revenue estimate should be closer to $17 billion meaning that another $300-$400 million needs to be cut for the remaining four months.
The primary reason to take this two week working recess was not only to identify more cuts, but also to see what February’s revenues would be. If the downward trend continues, then obviously more cuts must be made.
So this is the position we find ourselves in- if we measure by revenues, Georgia’s state government is now 25 percent smaller than it was 2 and a half years ago. During the last 18 months, we have experienced the largest revenue decrease in our state’s history.
Our spending levels now must be reduced to 2005 budget levels even though our population has grown by 600,000 since that time.
Where will those cuts come from?
Because education has rightfully been cut less than any other area, it has now grown to over 60 percent of our total budget.
During the two week working recess, the Board of Regents was asked to come up with a proposal to cut an additional $300 million from their budget and responded by, among other things, suggesting cuts and in some cases elimination of popular programs such as 4-H. This caused an outcry from constituents who thought legislators had made these suggestions, when it was actually the suggestion of the Board of Regents.
Regardless of who or what caused the miscommunication, legislators were more interested in administrative cuts and elimination and the results were unfortunate for everyone involved.
Nevertheless, reducing the size of state government remains one of the few certain ways of resolving this financial catastrophe. With over 80% of government costs being in employees, a workforce reduction appears to be imminent.
And what about increasing taxes?
While a managed care tax on hospitals has not been warmly welcomed, a proposed increase in tobacco taxes seems to be getting at least some attention.
However, as our budget has proven to us all, revenue enhancements contain much uncertainty as opposed to the certainty that goes along with budget cuts.
And so this is the situation we as Georgians find ourselves in- decreasing revenues and a constitution that requires us to have a balanced budget.
In the next few weeks we’ll argue and we’ll compromise and all of us will feel the pain- some perhaps more than others.
And while some things will definitely change, in the end the most important things won't- we live in a great state, we all want what’s best for our citizens, and we are all in this together.
Carter can be reached at Coverdell Legislative Office Building (C.L.O.B.) Room 302-B, Atlanta, GA, 30334. His Capitol office number is 404-656-5109.
Editor's note: This was written before Gov. Sonny Perdue revised budget numbers Thursday.