Lawmaker says Governor’s rosy budget talk is ‘misleading’

Published 9:25 pm Wednesday, August 9, 2006

Even if Mississippi’s economy continues to thrive, top lawmakers say it will be difficult to write a new state budget and plug holes in the current one.

Some agencies won’t get all the money they request, said House Appropriations Chairman Johnny Stringer, D-Montrose, and Education Chairman Cecil Brown, D-Jackson, who gave reporters a budget briefing Tuesday at the Capitol.

Gov. Haley Barbour says the state had $70 million left over when the last fiscal year ended June 30. Barbour also has said that in the 2 1/2 years he’s been in office, the state has dramatically reduced its habit of covering recurring state expenses with money that’s only available one year at a time.

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Brown said the picture is not as rosy as the governor portrays.

“These press releases that are coming out that are saying we’re in great shape, we don’t have any one-time money, we have a surplus and all that — that’s just misleading the public. That’s just not true,” said Brown, a former state fiscal officer who currently serves on the 14-member Joint Legislative Budget Committee.

At the Neshoba County Fair late last month, Republican Barbour said that in 2003, the last year his Democratic predecessor was in office, the state “spent $720 million more than we took in, in recurring revenue.

“Now, we’re back to a $70 million surplus for the fiscal year that ended June 30,” Barbour said. “And we’ve done it without raising anybody’s taxes.”

Stringer said that in the current budget year, which started July 1, the state has $110 million shortfall for Medicaid and a $13 million shortfall for repayment of long-term debt.

The Legislative Budget Committee will hold hearings in September. The full Legislature will vote on budget details during the session that starts in January, and the new fiscal year starts July 1, 2007.

Also during the session, lawmakers also will plug holes in the current $4.5 billion budget, including the shortfall for Medicaid.

Stringer said preliminary research by the Legislative Budget Office shows a need for at least another $618 million. That includes money to cover the Medicaid and debt-service shortfalls this year, plus anticipated increases for education, state employees’ health insurance, replacement of aging bridges and other programs.

And, he said lawmakers expect to receive hundreds of millions of dollars more in requests from the Institutions of Higher Learning and other state agencies.

Even assuming the state takes in roughly $500 million more next year than this year, all the money — and then some — would be gone, Stringer said.

Legislators and statewide officials are up for re-election next year. Asked if that increases the pressure on budget writers, Stringer said: “I don’t think you can be under more pressure than what we’ve been under the last three years.”

Mississippi, like most other states, was affected by a national economic slowdown earlier this decade. At the same time that was happening, lawmakers here committed to a multimillion-dollar, five-year teacher pay raise plan.

“We got caught in a double whammy,” Brown said.

Stringer and Brown said they don’t foresee any push for a general tax increase during the 2007 session.

Lt. Gov. Amy Tuck, a leader of the Legislative Budget Committee, already has said she’ll revive her push to reduce taxes on groceries and increase them on cigarettes. Lawmakers passed two different plans to do that earlier this year, but Barbour vetoed both.

Responding to questions at the Neshoba Fair last month, Barbour said Mississippi has a “tough budget year” coming up and he indicated he won’t support a cigarette/grocery tax swap.

“Without realizing it, ignorant of the budget realities, we don’t need to cost the state lots of money that has to be used,” Barbour said. “So, we haven’t seen a deal yet that’s truly revenue neutral and we’ll see if we ever see one.”

Stringer on Tuesday said he’ll vote for a bill that cuts taxes on groceries and increases them on cigarettes if it’s similar to proposals that passed and were vetoed this year.

Said Stringer: “I’m going to be on the front row saying, ’Amen.”’