State budget deal filled with huge cuts and ridiculous gimmicks

By BARRY BROAD, CTPAC

In late July, the Legislature and the Governor finally agreed on a plan to close a $26 billion gap in this year’s budget that was originally enacted in February. The deal contains huge cuts to important programs like education and social services. It is also riddled with budgeting gimmicks and has no new revenue.

Analysts have already forecasted that we will have another deficit next year in the $8 billion range and that these fixes aren't enough. The Governor has already called for another Special Session of the Legislature in September. In other words, we just applied a giant bandaid but the patient is still bleeding badly.

In announcing the budget deal, the Governor referred to it as the “good, the bad, and the ugly.” He was wrong though. It’s only bad and ugly. Below are a few of the lowlights.

Proposition 1A suspended

A major component of the deal is the suspension of Prop 1A, the provision in law that protects local government funding. The result is $2.1 billion less for counties and cities to provide services this year. It is designed as a loan to the state that allegedly must be paid back. But given economic forecasts, repayment any time soon is questionable. They did, however, authorize local governments to securitize the promised repayment in order to stave off deep cuts to local services. All of our locals that represent public employees should be urging their electeds to look very hard at this option before engaging in takeaways and layoffs.

Education slashed

Education was slashed to the bone. K-12 took a $6.5 billion cut and higher education lost $2 billion. This means larger classes, continued layoffs of classified employees, and more tuition increases for college. There have been promises of some restored funding and maintaining the maintenance of effort requirements for elementary and high school funding, but it’s difficult to see where the money will come from.

Health care and social services cut dramatically

If education was slashed to the bone, health care and other social services’ marrow were sucked dry. They cut out whole services to the aged, blind, and disabled. They froze enrollment and cut funds to the program that provides healthcare to needy children and they dramatically reduced funding for in-home care. They also eliminated the cost of living adjustment on various social service programs. Basically, the neediest in this terrible economy are hit the hardest.

Budget gap still not bridged

All in all, the $15 billion in cuts aren’t nearly enough to bridge the gap. Since the Republican Governor and his Legislative cohorts were unwilling to raise a dime in new revenue and there were simply no more cuts to be made, the deal also includes “cost saving” measures that really don’t amount to more than mere gimmicks.

Unfortunately, some of these gimmicks will hurt. One provision allows for automation and contracting out of all social service eligibility determinations that occur at the local level. This means that eventually some 25,000 jobs could be contracted out, including some county-level Teamster jobs.

This is a gimmick for two reasons. One, it actually costs money in this budget year and two, there is no proof that contracting out these services will save any money. Additionally, the budget deal includes paying public employees one day later at the end of the fiscal year so that the costs are shifted to next year and selling off valuable assets for dubious political reasons for less than they are worth.

No wonder we find ourselves in the mess we’re in!