State government faces sharp cuts
By Staff
Montgomery Advertiser
There's no way to put a pretty face on it — Alabama state government is facing tight financial times. And when state government is financially squeezed, the pain eventually is felt by everyday Alabamians.
Each year when the Legislature holds budget hearings prior to its annual regular session, state agency directors parade before the budget committees with their wish lists. Almost all have dire predictions of what will happen if their agencies don't get increased funding. Despite the warnings, the agencies seem to always get by.
Last year, for instance, the federal government came to the rescue with huge infusions of stimulus money. The federal cash bailed out both state agencies and public education in the current fiscal year, preventing many of the predicted layoffs and reductions in services.
Now, with the focus in Congress on health care and with growing concerns about ballooning federal deficits, it is not at all certain that Uncle Sam will fire up the presses to print more money to bail out the states again.
Earlier this month, the Legislature's budget committees held hearings on the coming 2011 fiscal year General Fund and education budgets (which go into effect Oct. 1, 2010) and the messages the committee members heard can be summed up in two words — gloom and doom. That was true of both the General Fund budget, which covers the operation of most state agencies, and the education budget, which covers public schools and colleges.
Legislative Fiscal Officer Joyce Bigbee predicted that the portion of the General Fund budget that comes from state revenues would be about level at $1.3 billion. But she predicted that federal revenues that fund state agencies could drop by $600 million. That would shut off a huge portion of the revenue stream that supports such things as state prisons, Medicaid, health department services, state troopers, and so on.
Bigbee predicted a decrease of about 7 percent in state money available for public schools and colleges. State Superintendent of Education Joe Morton said such reductions in already depleted budgets will force teacher layoffs.
While the hearings focused on the 2011 budgets, the problems will arrive well before next October. It's likely that in the next week or two, Gov. Bob Riley will have to order state agencies to reduce spending by about 7 percent in order to balance the current budget.
It won't be any consolation for Medicaid recipients who might lose a needed prescription or state employees who might lose their jobs, but Alabama is far from being the only state facing such tight times. The Center on Budget and Policy Priorities reports that at least 39 states face major budget shortfalls for the current fiscal year.
When legislators return to Montgomery on Jan. 12, they will have the unhappy task of trying to write balanced budgets for the coming fiscal year. It will be an election year, so it's extremely unlikely they will raise taxes. The best the public can hope for is that lawmakers will design budgets that have the least possible negative impact on the the citizenry and school children.
