Mississippi Governor Barbour Proposes 12% Axe In State Spending
Barbour, a former chairman of the Republican National Committee, is among the first of the 50 U.S. governors to present a spending plan following a fiscal year in which state revenue declined at the sharpest rate in at least 45 years, according to the Nelson A. Rockefeller Institute of Government in Albany, New York.
Barbour plans to shrink the budget by shutting mental institutions, consolidating school districts, merging state colleges and trimming spending at most departments by 12 percent. The outline, presented yesterday, may offer a preview of other states strategies as they confront budget gaps the Washington, D.C.-based Center on Budget and Policy Priorities has estimated at $180 billion.
“These are bold changes,” Barbour said in a letter to lawmakers. “When the state faces a budget reality that requires savings of some $715 million compared with current year appropriations, half-way measures wont suffice.”
Barbour published his budget proposal the same day Pennsylvania announced the termination of 319 state workers and Rhode Island revealed a $220 million hole for the first three months of the current budget year. New Jerseys incoming governor, Christopher Christie, said he expects a deficit of more than $8 billion in the 12-month period beginning July 1.
Revenue Shortages
Nationwide, states reported a total of $58 billion in revenue gaps for the budgets they will be preparing for the next fiscal year, the Center on Budget and Policy Priorities reported Oct. 20. The think tank expects that total to rise to $180 billion, almost equal to the $181 billion officials confronted in the current cycle.
Mississippi is the 31st-largest state by population, with about 3 million residents, according to the U.S. Census Bureau.
“We have to make savings,” Barbour said at a news conference in the capital, Jackson. “If you dont like it this way, come up with another way.”
Under Barbours proposal, the administration of three historically black state colleges, Jackson State College in Jackson, Alcorn State College in Lorman and Mississippi Valley State University in Bena, would be combined.
The plan would also close four Department of Mental Health institutions and six crisis centers in a bid to save money and emphasize home- and community-based care, he said.
School Consolidation
He would also freeze state contributions into the pension system for government workers. Trustees of the Public Employees Retirement System, which was about 74 percent funded before it incurred 4.9 percent in investment losses amid the recession, had sought a $70 million increase. Barbour proposed employees cover the additional cost with higher payroll deductions.
“We have to live within our means,” he said.
States tax revenue declined by 16.6 percent nationally during the three months ending June 30 compared with the same period in 2008, the Rockefeller Institute reported last month.
States will face diminished revenue through 2012, a survey of fiscal officials by the National Governors Association and the National Association of State Budget Officers said in a report published Nov. 12.
“The situation for state finances continues to be dire,” said Arturo Perez, fiscal analyst for the National Conference of State Legislatures in Denver, Colorado.