Gregoire faces budget choice

Spending: Special session or across-the-board cuts? Decision due after Aug. 10

July 29, 2010 

Gov. Chris Gregoire

Gov. Chris Gregoire (The Olympian File Photo)

Gov. Chris Gregoire says she will decide soon after Aug. 10 whether to call a special legislative session or make across-the-board budget cuts on her own to reduce a budget shortfall that is about $300 million if federal aid falls through.

Gregoire plans talks today with Democratic and Republican legislative leaders about the feasibility of having a two- or three-day special session in the fall to fix the growing shortfall.

The governor spoke with reporters Wednesday in her office, explaining that across-the-board cuts are her other option, but she thinks that is a “blunt instrument” she’d rather not use.

Executive-ordered cuts would carve 3.5 percent to 4 percent out of virtually all state-funded programs — prisons, social programs, and universities alike — with exceptions only for basic education, debt payments and pensions. Prisons alone could have to cut $25 million despite moving to shutter two institutions and close two others later, Gregoire said.

“My question to them will be, if I call them into special session, can they get it done and can they get it done in 48 to 72 hours?” Gregoire said, suggesting in almost the same breath she isn’t sure that’s possible based on what House Speaker Frank Chopp and Senate Majority Leader Lisa Brown have told her previously.

Gregoire said she will make her decision shortly after the next tax-collections report on Aug. 10. She is prepared to give lawmakers a draft budget proposal that would look a lot like the much-hated “all-cuts” proposal she offered last December.

She has held a series of budget hearing around the state but said Tuesday night’s session in Vancouver showed there is clearly no consensus about cuts or revenue.

The latest state revenue crisis is driven mostly by Congress’ failure to act — as Senate leaders once planned — to send extra medical and welfare aid to the states, which assumed the revenues in their budgets based on earlier promises.

Washington’s share of that aid is about a half-billion dollars, and Gregoire says she is not optimistic about getting it, despite efforts by U.S. Sen. Patty Murray and others to bring a vote before the Aug. 9 summer recess for Congress.

But the struggling economy is spinning fewer dollars than predicted into the state coffers, widening the gap an additional $85 million during the June 10-July 10 period alone.

Two House Democrats who chair budget and finance committees — Rep. Kelli Linville of Bellingham and Rep. Ross Hunter of Medina — have written Gregoire saying they doubt their majority party, which struggled to approve tax increases this year, can reach any quick agreement on spending cuts.

Other Democrats who are up for re-election question the wisdom, too.

“I think it would be a terrible mistake,” said Rep. Sam Hunt, D-Olympia, who has two challengers for his 22nd district seat. “It took us 30 days to do the last one when we talked about revenue. You’ve got people running for election in a year that is filled with turmoil and doubt and questions. Again it would boil down to Democrats having to provide all the votes and leadership. We wouldn’t get any help from the other side. It’s a question of who do you subject to all of this.”

Some Republicans, notably Sen. Joe Zarelli of Ridgefield, have publicly called for Gregoire to order a new session, which can run up to 30 days once lawmakers convene. In his latest “Budget Tidbits” report, the Republican budget expert said Gregoire was prudent to assume federal aid isn’t coming if Congress doesn’t act before its Aug. 9 summer recess.

Zarelli also wrote that a budget is not “one-size-fits-all” so cuts across-the-board would nick programs for the developmentally disabled as deeply as spending for tourism, and financial aid to students would be cut at the same rate as public art funding. “We should be expected to rise to our duty” to write a budget, Zarelli wrote. “And the governor should demand nothing less.’’

Zarelli also said a special session lets lawmakers provide a reserve, which Gregoire agreed is a good thing to have.

State schools chief Randy Dorn said he is not urging a special session but wants the public to know that across-the-board cuts would hit such non-mandatory spending as levy equalization, which helps tax-poor school districts, and class-size reduction money. Gregoire says that could nick teacher jobs and is already on the record as saying the loss of federal medical aid could cost 6,000 state-government jobs through program closures.

Hunt and others have pointed out that minority Republicans did not support the budget cuts or tax increases that Democrats voted to approve earlier this year. Because the GOP never offered a viable plan for cutting the budget enough to avoid those tax increases, it is not clear the minority party would offer up ideas for cuts that their members also would vote for this time.

Gregoire said the law allowing across-the-board cuts is too blunt and she would like it amended next year. “I don’t think this is the right tool for a governor. The last time we used it was 1991. I think it is a ridiculous tool,” Gregoire said, referring to a lack of discretion on priorities that she would like a governor to have in situations like this one.

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