I’ve been talking to several State lawmakers over the last few days trying to get a handle on the State budget – THE single issue that has come to dominate the 2010 Session.
Through these discussions, some hypothetical numbers have been thrown out there, and I think they merit a discussion here.
Let’s take the target as $1 Billion. This is the number everyone was working off of last week, and most still are.
Most special interest tax breaks expire after some number of years and have to be renewed to continue. It is thought that we can save $100 million in non-renewal of certain special interest tax breaks this year.
We could then try to convince people near retirement age to take an early retirement, and save another $100 million. ($200 million so far, $800 million to go)
We then make $400 million in out right cuts. This is just me thinking, not anything that was mentioned by any source, but I genuinely think we can probably find $100 million to cut in each of the Big 4 Departments, and barring that it should be extremely easy to find $50 million to cut in each of the Elite 8 departments that eat up something like $16 Billion of last year’s $18 Billion budget. Again remember though, the Board of Regents is one of the Big 4, and they are a “black box” – the General Assembly ONLY gets to dictate the level of funding, not what that level pays for. In other words, the General Assembly could tell the Board of Regents to cut $50 million, and the Board could decide to cut the $11 million 4H program in retaliation, as they have already threatened to do. ($600 million down, $400 million to go)
Here’s where we start to step out of the hypothetical and into the realm of bills already being introduced though:
Next, we look at $300 million in outright tax increases. There’s a whole lot of taxes charged by the State out there, and it would hypothetically be possible to raise $300 million without any single tax being raised dramatically – but it would still be a tax increase, and it would still be felt to some degree. Proposals already out there include a hospital bed tax and a $1 per pack increase in the cigarette tax, but that will be the subject of another post later today. ($900 million down, $100 million to go)
Finally, we look at $100 million in “user fee modernization”. Some sources have had the cajones to call them fee increases outright, and Rep Earl Erhart had a bill introduced last session to call them what they are – tax increases. Some of these proposals already out there include a $75 surcharge to run for office at any level (HB 1297). Which means that instead of paying $25 or so to run for Lee County School Board, now you would pay $100 – with $75 of it going directly to the State. There is also a proposal out there to increase court fees which in the most extreme case would be a nearly 700% increase (from $5 to $34), with increases anywhere from 33%-150% being more common. That bill is HB 1328. HB 1343 would increase the cost of probation by $7 per month, as well as double the one time fee for a felon.
Finally, there is also a pair of bills that would place the fee maintenance burden on the department heads (shifting the blame for any increases away from the General Assembly), but then require a published list of all fees every year (thus at least letting you know once a year what the fees are). These are HB 1283 and HB 1284, respectively.
What I have presented above is a hypothetical, completely fluid picture of what is possibly being considered by the General Assembly as we speak. It is a finely balanced 5 legged stool, and if any leg comes up short, the shortfall must be made up somewhere else.
As you can see though, everything – including tax increases – IS on the table at the moment.
[UPDATE] One potential “silver bullet” (the ONLY thing mentioned to me as such)?
A 2.5 cent tax on everything purchased, with no exceptions whatsoever.
I’m not sure how seriously this one is being considered, but it WAS something that was discussed out loud, at least to me.
While the General Assembly struggles with the budget shortfall it also continues to pass legislation that adds to the cost of government. Yesterday both houses passed identical “water conservation” bills that direct the EPD and others to do things that require people and money and financially impact cities and citizens as well. Lots of governing few answers.
[...] those cuts be as dire as the author of that memo seems to think? As I said this morning, anything is certainly possible at this point. Everything related to the budget is absolutely fluid [...]