Wildfires add to West's budget burden

LOS ANGELES, Jan. 3 (UPI) -- Western states that line up in Washington for assistance with their respective budget crises will have one extra item on their collective agenda, the need to make sure that substantial amounts of federal cash remain available to pay for fire protection in the region's forests.

Like most states across the nation, the West is grappling with the dilemma of raising taxes or slashing spending -- or both -- as means of addressing often-alarming revenue shortfalls. The West, however, also faces the prospect of another summer of apocalyptic fires chewing up trees, homes and dollars at the same time officials are trying to hold down the lid on spending.

Raging wildfires that consume hundreds of thousands of acres of drought-stricken and brush-choked mountain forests have become alarmingly common in recent years and have drained state firefighting budgets to the point that winning additional funding has become a priority in the West, albeit admittedly at a very inopportune moment.

"As you prepare the federal budget for fiscal year 2004, and as you work with Congress on the FY03 appropriations bills, Western governors ask that you ensure that sufficient funds are available to both fight wildfires and to complete the cost-effective proactive work that will reduce the risks and costs of future wildfire seasons," the Western Governors Association said in a Dec. 20 letter to President Bush.

The president late last summer called for an accelerated program of fuels reduction in which logging is permitted only in certain areas in order to clear out volatile underbrush that can fuel cataclysmic fires. The thinning process is also labor intensive and expensive, which means that the long list of proposed federal thinning projects may have to be shelved at the same time state firefighting agencies have little money to spare for massive amounts of overtime pay and supplies needed to combat major blazes.

"This year was one of the worst wildfire seasons in history, and we fear that the devastation may be even worse in the future unless significant progress is made in addressing the underlying problem of fuel-load buildup in our forests," the WGA letter continued. "We lost ground in this effort in 2002 as funds that were intended to be spent on proactive pre-suppression activities, such as thinning, were instead diverted to pay for the extraordinary fire suppression costs that were incurred."

Western wildfires burned around 7.1 million acres in 2002, compared to 8 million the previous year. The National Fire Plan was allocated more than $2.26 billion in the 2002 fiscal year.

Bush likely is committed to fire-prevention projects due to its high profile images on televisions of voters, and the federal government spent $1.5 billion on firefighting in 2002. However state agencies also have hefty firefighting bills to consider at the same time they look for ways to hold down their costs.

Political analysts and lawmakers alike have warned that the coming year will be one in which everyone feels the pain of soaring budget deficits that are being blamed primarily on the sluggish economy.

As with most states, the West will be looking at making potentially painful cuts in Medicaid, education and social programs, and possibly boosting taxes to make up for lost revenues.

"State revenues will go up and down with business cycles, and there's nothing you can do about it and they (states) have balanced budget requirements," said Iris Lav, an analyst with the Center on Budget and Policy Priorities. "The best thing states can do is to have very good rainy day funds on hand."

The CPPP called for additional federal help for Medicaid programs in order to avoid the need to cut health services or throw recipients out of the program altogether. Some conservative analysts have said all states should look first to improving efficiencies in state bureaucracies before sticking it to the poor -- or even worse, raising state taxes.

The CBPP maintained that Medicaid was already fairly efficient due to past budget squeezes and warned that further reductions in the reimbursements that are paid to healthcare physicians would accomplish little.

There likely will be a great number of adjustments made to tax and fee structures as well.

In Alaska, incoming Republican Gov. Frank Murkowski is considering a reduction in fees charged to transport oil on the Trans-Alaska Pipeline. The idea is to encourage more oil production in the state, which would raise an estimated $110 million per year in additional revenue and falls in line with Murkowski's market-driven philosophy held on the Senate Energy Committee. As governor, however, he has the budget to consider as well, so he hasn't made up his mind yet on whether or not to support the idea.

Montana Gov. Judy Martz's proposal to dip into the state coal tax is one of a handful of proposals under consideration to raise more money for the state's schools where enrollment is expected to grow by 25 percent to 30 percent in the next five years.

Washington Gov. Gary Locke's proposal to cut $12 million from the state parks' budget by closing as many as four state parks has already stirred up vocal opposition and won't do much to close a $2 billion deficit over the next two years.

Nevada is considering a "gross receipt tax" of 0.25 percent on a company's entire income, whether the company turned a profit or not. The idea was proposed by a task force formed by Gov. Kenny Guinn and has some support in the Legislature, however the Las Vegas Chamber of Commerce came out against the idea more than a month before the Legislature convenes on Feb. 3.

However, there is optimism in Hawaii that the state's economy will show continued growth following the major drop in tourism suffered after 9/11. Hawaii's tourism and retail sectors rely on Japan, and the state expects Japanese visitor levels to slowly increase in 2003. A survey of state lawmakers by the Honolulu Advertiser indicated that while proposals to raise the minimum wage and eliminate excise taxes on rent and food are supported, the majority opposes raising alcohol and tobacco taxes and also is against the idea of organizing a state lottery.

Tax increases are generally an option that is at odds with the Republican majorities in many states and with the conservative GOP minority in California that has swing vote potential and has vowed it would not support tax increases despite a breathtakingly behemoth $35 billion shortfall for the next 18 months.

Sherry Bebitch Jeffe, a member of the University of Southern California faculty and longtime observer of California politics, predicted in a recent analysis for the Los Angeles Times that the Republicans might not be able to stick to their ideological guns.

"Can GOP legislators who represent competitive inland districts afford to hold out on raising revenues needed to finance programs their constituents consider important?" she asked. "Will they risk the wrath of Republican activists for deserting their caucus' no-new-taxes stand, or hazard the loss of support from constituents who believe their quality of life to be threatened?"

There has been speculation among analysts of all political stripes that California's budget crunch could lead to a great deal of debate in the state over issues ranging from tax reform to high-priced corrections budgets and even term limits. There may not be time for lawmakers to finesse their way out of the current jam and, in the end, California and the rest of the West will likely have to take a deep breath and make the tough decisions they were elected to make.