Friday, October 16, 2009
AZ FACING MORE CUTS
Arizona Governor Jan Brewer, a conservative Republican, inherited, as a result of the housing slump and a spending spree by Democrat former Governor, Janet Napolitano, a state government spending more then it was taking in. Hard, responsible, decisions had to be made and Brewer made them. She made the greatest cuts in state spending in Arizona history.
Brewer accepted reality however, budget cuts alone would not solve the budget crisis and let the Republican controlled legislature know that nothing was off the table, including the need for increased revenue to provide government services.
The governor sponsored a plan that was hailed by the Wall Street Journal as a budget breakthrough for state government and an alternative to the California tax and spend model. The plan would have repealed the hated tax on business property, would have provided one of the largest state corporate income tax cuts in the nation, from 6.97% down to 4.86% and cut all individual income tax rates by 6.6%. In exchange, the legislature would allow a one cent temporary sales tax increase to be referred to the voters. The temporary sales tax referral would have given the people of Arizona a say in how much they wanted to spend on government and would have only taken effect if they approved it.
Former U.S. Treasury economist Robert Carroll of the Tax Foundation claims that states with lower corporate tax rates have higher wages and more productivity. Small business also would have benefited from the lower rates, which would have allowed them to reinvest in their business.
Governor Brewer's plan was a, win-win, for Arizona and an agreement was reached with the Republican Caucus of both the House and the Senate to repeal the business property tax and cut the corporate and individual income tax rate in exchange for a referral to the voters of a temporary sales tax increase of one cent.
The Arizona House approved the agreement but two extremist in the Republican controlled Senate, Pamela Gorman and Ron Gould, who both claim to be Republican, broke ranks and voted with the Democrats against the sales tax referral and therefore killed the agreement.
Arizona now faces a $1,5 billion deficit for the FY 2010 and possibly a $3 billion deficit next year unless draconian cuts are made in state spending.
The governor's office has asked state agency directors to submit plans for a possible additional 15% cut in their budgets.
Some state agencies have reported what they would have to cut if budget cuts of 15% were required of their agencies because extremist in the legislature insist on cuts to close the state budget deficit.
According to a report in today's Arizona Republic.
The Arizona Department of Corrections would be forced to reduce its budget by $153 million. which would require;
* Early release of 13,000 prisoners.
* Reducing mandatory time served by 50 percent for most serious felonies,
* Closing the Arizona State Prison Complex at Douglas and the prisons at Globe, Fort Grant, and St. Johns,
* Laying off 1,500 employees.
In his letter to Brewer's budget director, Eileen Klein, DOC Director Charles Ryan explained, "Rewriting the criminal code and releasing thousands of prisoners is neither realistic nor in the best interest of public safety," and that , "Releasing thousands of prisoners because of the budget deficit will place the public at risk and is akin to turning our back on the law-abiding citizens of Arizona."
Arizona Department of Environmental Quality warned of increased noncompliance at landfills and bio-hazardous medical waste treatment facilities and reduced monitoring of pesticides entering the water systems in Arizona.
Arizona's universities, ASU, UofA and NAU, have already cut $231 million, or 21% of their state funding this year and estimate that a 15 % cut would equal an additional $135 million is cuts.
Regents President Ernest Calderon reported that, "We'd have to look at everything." Calderon explained that 15% was the equivalent of $1,300 in additional annual tuition charges per student or the elimination of 2,200 jobs.
The Arizona Health Care Cost Containment System, (AHCCCS), would be forced to reduce its budget by $44 million and would have to eliminate its Kids Care program, which currently covers 46,957 children, who would lose their health insurance coverage.
The Department of Public Safety, (DPS), Director, Roger Vanderpool, during a radio interview today said he would have fever officers, resulting in longer response time to emergencies. He estimated 570 to 600 employee cuts.
We may have to suffer further cuts that may turn Arizona into a third world state and seriously hurt the Republican party in future elections for the legislature and the governor's office, but Senator Pamela Gorman, who is eyeing a Congressional seat and Senator Ron Gould, can always say they never voted for a tax increase or referral and are therefore champions of the taxpayer, of course what is good for Gorman and Gould comes first before; country, state, community or party, at least according to Gorman and Gould.
American Conservative Republican