state Budget Update

Feb. 2, 2009

Transcript:

Ted Simons:
Hello. Welcome to "Horizon." I'm Ted Simons. A new state lawmaker was named today. Tolleson Vice-Mayor Anna Tovar was named by the Maricopa County Board of Supervisors to replace Democratic representative Steve Gallardo in district 13. Gallardo quit the post last month after being reelected in November. The 34-year-old Tovar is a lifelong resident of Tolleson, she's a Democrat, and a former school teacher and has been the city council there for eight years. State lawmakers worked until 2 am on Sunday to hammer out a budget fix on the current fiscal year budget, which had a nearly 1.6 billion dollar shortfall. The budget was made by hitting education the hardest. K through 12 educations took a $133 million hit. Universities were cut by $141 million. Community colleges suffered a $9 million rollback. Health care was also hit. Access targeted for $39 million in cuts. The Department of Economic Security was cut by $90 million. Corrections suffered a nearly $22 million loss in funds for the fiscal year that ends in June. Cuts totaled close to $600 million, nearly $600 million was made up by funds transferred and the rainy day fund and lawmakers are expecting $500 million from a federal bailout. Here to talk about the budget fix is house majority leader John McComish. Good to have you back on the program. Thank you for joining us.

John McComish:
Thank you, Ted. Nice to be here.

Ted Simons:
Um, health care, universities, k-12 education, big, deep cuts why so big? Why so deep?

John McComish:
Why so big? Why so deep? It's necessary. The constitution says we have to have a balanced budget. We were $1.6 billion in revenue behind what our projected expenses were so we had to find cuts and reductions otherwise to get there.

Ted Simons:
There was some thought some criticism there was a rush -- it seems there was a are rush by Republican leadership to get this done especially with the idea that a stimulus package might be on the way to help matters more than already anticipated. Your response.

John McComish:
That's a fair comment. The background is had we waited beyond February 1, it would have cost us $160 million in potential savings we could have had we waited beyond that to enact. That gave us the incentive to push ahead and actually we've been looking ahead from our appropriations chairs and our joint legislative budget committee for several months. While it seems like we're moving quickly -- and we, in fact, did -- it was very necessary to get done by February 1 and we did.

Ted Simons:
And yet so many vital programs have been cut. Some are saying that the programs have been cut setting the state back four years. Again, your response.

John McComish:
Again, I have a similar response to your first question that we can only spend money that we have and, yes, some of the cuts were difficult and there are things that most of us would rather not have had to face but that's what we must do. What we tried to do in many instances to make them as palatable as possible and working with the stakeholders was for example in both k-12 and university education as well as with some of the state agencies, we tried to give them ultimate flexibility rather than saying, "You must cut this program. That program. The other program." We gave them lump-sum cuts and said, you're the experts. You're running this agency or whatever and you need to figure out best how to do it. We did the same thing with personnel. Instead of saying you have to cut x number of personnel, we said, "ok, you figure out the way. Is it furloughs? Is it reductions? Just how do you want to do that?" Understanding it's difficult we tried to give them as much flexibility within that.

Ted Simons:
You mentioned we can't spend money we don't have. What about finding money by way of a tax increase?

John McComish:
Ok, a tax increase, if we implemented a tax increase today, it wouldn't have any effect on this fiscal '09 budget. That's one thing. Thing two is that it would be very -- it takes a 2/3 vote of the legislature and the Governor would have to sign it and that's a pretty big mountain to climb for a tax increase. In addition there's the philosophical issue. Is it wise -- with the tax increase, is it wise to take money out of the economy when our residents and our businesses need all the money they can to promote our economic well-being.

Ted Simons:
The philosophical question being do you get that money over to the businesses as opposed to taking that money which is happening now to education and health care?

John McComish:
Yes, yes.

Ted Simons:
Do you blame the Governor for this?

John McComish:
Governor Brewer? No.

Ted Simons:
No. [Laughter]

John McComish:
[Laughter] Yes, Governor Napolitano has some culpability in my opinion in that we've known for quite awhile that this day of reckoning was coming. The Governor refused to recognize that. She kept hoping against hope that this was going to be a little bump in the road and was reluctant to take real cuts. You know had you taken more of a cut a year ago, six months ago, then that's less of a cut we would have had to have taken today so, yes, I put some of the blame at her feet. Certainly the economy is the biggest issue.

Ted Simons:
But what does that say about Republican leadership if the Governor and so many lawmakers are putting a lot of blame -- the Governor included with a pretty direct statement towards the previous administration. What's it say about G.O.P. leadership that Democratic Governor could do so much "damage" with both house and senate? Pretty rock solid there.

John McComish:
Yes, that's an interesting question and it is -- it -- what we say in the legislature is that it takes 31-16-1. The 31 and the 16 obviously are the members of the house and members of the senate and the Governor only has to negotiate with herself while we have to negotiate with -- we have 60 representatives, 30 senators and you have to try to appease all of that group and the Governor being only the one only has to satisfy herself so she's a little strong in the negotiating position because of that.

Ted Simons:
You mentioned all of the people that need to be appeased. There's also a line of criticism that says the Democrats were, a, shut out of the process and, b, there were secret meetings in the end to which Democratic lawmakers and some Republicans didn't know what was going on.

John McComish:
My response to that is the Democrats were certainly included. I was in meetings where the Democratic leadership was kept up to date on exactly what was going on step by step. If they failed to pass that along to their members, then that's on their shoulders and, yes, things were moving fast as we said before out of necessity so at times, it wasn't -- the process was not as, um, transparent to the public as we would have liked for it to be but it was because of the speed we had to move.

Ted Simons:
That should change for the '10 budget, too? The 2010 budget?

John McComish:
That's absolutely our plan. Because we don't have it over our heads on the February 1 date, we'll be much more transparent. It'll be much more of a process that goes one step to the next step to the next step.

Ted Simons:
Last question, Arizona is traditionally -- and we're not talking about construction spending here -- but per pupil spending is always pretty far down the list.

John McComish:
Uh-huh.

Ted Simons:
How do you change that? I mean, this is obviously not going to help matters at all. When is Arizona going to get passed ranked in the 40-something in per pupil spending?

John McComish:
That's interesting again. One time we had three different sets of figures that showed we were ranked 49th. Not sure which it was. It depends on whose numbers you look at. Usually the statistics you're talking about don't include for capital expenses, Arizona being a growing state, we have considerable capital expense where an established state doesn't. If you look at total expenses, money and capital, we're in about the middle of the pack.

Ted Simons:
Is that good enough to be in the middle of the pack?

John McComish:
No. No. I think we ought to be -- we ought to strive for excellence certainly in performance. I don't know that we need to strive to be in the middle of the pack but we're not in total spending per pupil -- we're not at the bottom when you count total, total spending as we've been accused.

Ted Simons:
Thank you for joining us here.

John McComish:
Thank you.