Private sector offers state budget lessons

One week into the session, the 2010 state Legislature is just starting to get its arms around solutions to the $2.6 billion budget deficit.

In her State of the State address to lawmakers last week, Gov. Chris Gregoire acknowledged what is obvious to most people: The state can’t just rely on state spending cuts to patch together an acceptable budget.

Without at least some new revenue, the required cuts in education and health care would be difficult, if not impossible, for this state and its citizenry to bear.

At the same time, she vowed to help create 40,000 new jobs through a variety of initiatives, including a tax credit for small businesses that add employees, increase capital investments in the state and permit extensions for projects that have been approved but delayed by the stalled out economy.

“Jobs are the way out of this recession,” Gregoire said, drawing one of those rare moments of hearty applause from Democrats and Republicans alike.

Obviously, the two parties will have different ideas on job creation. GOP leaders are right when they say the emphasis should be on creating more private sector jobs.

The new spending plan submitted by the governor last week would restore about $779 million in government services that were cut in her original December proposal. At that time, the governor called those cuts unacceptable. She wants to restore:

 • Support for poor school districts that have below average property tax bases: $165 million.

 • Basic health care coverage for nearly 65,000 low-income people: $160.5 million.

 • Grants to 12,300 college students who need financial help to stay in school: $146.4 million.

 • Other education and social service programs: $166 million.

The programs would require extra revenue. Some of it could be recovered by closing tax loopholes. Some would require one-time support from the federal government. And, yes, some could come in the form of higher taxes on goods and services.

Who can argue against closing tax loopholes?” That’s a no-brainer on tax breaks that have outlived their usefulness or don’t pass the test of equity in tough economic times.

Republican legislative leaders are opposed to new taxes of any sort. However, their message won’t be effective unless they back it up with a credible, innovative plan of their own to navigate through this mess.

Gregoire’s supplemental budget is a launch pad, a place to start the nitty-gritty work of rebalancing the budget. Every and all ideas to save money, cut government waste and reduce duplication of services should be on the table. Every and all rational idea for raising new revenue should be considered.

In a crisis such as this, there are no sacred cows. And that includes the compensation and benefits packages afforded state government employees.

For instance, state legislators are likely to consider state employee furloughs or “temporary layoffs” to reduce state costs in these dire economic times. Furloughs are distasteful. They are pay cuts. But they also are preferable to cutting jobs, and work better as a temporary measure.

Employees in the private sector have been subjected to pay cuts, reduced work hours and mandatory furloughs in an effort to keep businesses afloat and people employed.

Some of the lessons learned in the private sector do apply to the public sector. State government — all levels of government for that matter — need to reexamine the way they do business and adapt to these leaner times. Some of the efficiencies achieved will serve them well when the economy eventually recovers.

And as government cuts back on services not vital to the health and welfare of the citizenry, the public needs to show some patience and understanding.

A small but visual case in point: The state Department of General Administration will cut back on landscaping services on the state Capitol Campus in the months ahead to help balance its budget. It might mean the lawns are allowed to grow longer. It might mean fewer flowers in the flower beds. It might mean brown laws on campus this summer.

The green grass will return. Let’s hope the jobs do, too.