Arizona: A cadre of moderate Republicans have reportedly been on the attack against a budget agreement that observers consider fragile at best. The $6.2 billion spending plan erases a $1 billion deficit, however proposed spending cuts in education and health care are too much for the dissenters to accept. Calling themselves the "cellar dwellers," the unhappy lawmakers want to restore $161 million in social spending, which would be paid for by higher drunken-driving fines and springing a number of non-violent offenders from state prisons. Members of the leadership predict the budget will pass unchanged, although Gov. Janet Napolitano agrees there are a lot of quirky items hidden in the budget plan.
California: With great fanfare, Gov. Gray Davis unveiled a new budget proposal that he hopes will receive the bipartisan support needed to pass a spending plan by the end of the fiscal year in June. Davis says California is under the gun and must have the budget in place before Wall Street will accept the bond sale he has proposed as a means of eliminating a $38 billion deficit. Republican lawmakers are livid about the plan's tax increases, however deeper spending cuts risked alienating Davis' Democratic allies even further.
Hawaii: Hawaii received bad news this week when new revenue forecasts indicated that yet another $100 million would have to be trimmed from the budget by June 30. Individual tax collections are down 56 percent this year, and corporate collections are off nearly 37 percent. Gov. Linda Lingle blames loopholes in the state's high-tech tax credit and says the state budget passed by the Legislature simply can't be funded. In the meantime, Lingle has gone public in chastising the Legislature for cutting school maintenance funds, threatening some retaliatory vetoes against lawmakers' pet "pork" projects.
Idaho: Lawmakers adjourned after more than 100 days, a marathon in Idaho. Legislative budget writers last week restored funding in seven agency budgets that will over increases in employee health insurance premiums. A bill raising Idaho's sales tax by a percentage point passed, but only after the measure received a thorough raking over by the Legislature, which makes other new revenue enhancements unlikely.
Montana: Montana's Legislature adjourned at the end of April. The 2005 revenue bill passed in the waning days of the session was packed with increases in sin taxes and levies on hotels and rental cars that will be paid for by tourists and other visitors. While Gov. Judy Martz expressed regret at having to sign off on any tax increases, her fellow Republicans are pleased that they erased a $232 million deficit without a major hike. An issue for the next session may be prison conditions. The state Supreme Court ruled in late April that a policy of locking naked prisoners in solitary was inhumane and ordered corrections officials to document their changes in practices by the end of the year.
Nevada: The Legislature is on track to end its session as scheduled on June 2, thus avoiding the need for a special session. Statehouse observers believe the lawmakers are prepared to bite the bullet and enact a $1 billion tax hike that Gov. Kenny Guinn swears is necessary to keep vital state services at their current level. The tax hikes include business licenses, cigarettes and property, although late maneuvering might exempt "low-margin" businesses such as supermarkets and car dealerships. School districts across Nevada have until May 21 to submit their requests for state funding. Many educators and parents are bracing for the worst. Secretary of State Dean Heller complains that a campaign-finance reform bill he is championing is being quietly gutted while the Legislature deals with the higher-profile budget.
Oregon: The state Senate passed a measure that "disconnects" Oregon from President Bush's planned federal tax cuts. Like many states, Oregon's tax structure is based on the 1040s residents file with the IRS. Analysts say cash-strapped Oregon would lose more than $100 million in revenues annually under the Bush plan. Ideological opponents call the move a tax hike in disguise, but proponents say it's a move that is necessary to prevent an even further deterioration of public education in the state. Despite the Doonesbury jokes, Oregon's legislative leadership is holding the line in opposing tax increases despite a $2.7 billion shortfall.
Utah: The Legislature's two-month general session ended last month with passage of a budget battered by $700 million in shortfalls over two years. Revenue figures released this month peg Utah's revenue shortfall at $25-$31 billion. Gov. Mike Leavitt's staff says that's less than 1 percent of the total $7.4 billion budget. State officials reported back on an earlier request by lawmakers to look into the option of bailing out of the No Child Left Behind program. The conclusion was it would cost Utah $100 million in annual federal aid. By sticking with the program, however, the state will be on the hook for un-funded mandates and the need to add new administrative staff and pay for teacher training.
Washington: A special session is under way in Olympia as Washington struggles with a $2.6 billion shortfall. Senate Ways-and-Means Chairman has proposed some hefty cuts in health care and erased raises for state workers. He also wants tax credits for businesses to help get the struggling economy going, however he'll have to get those moves past Democratic Gov. Gary Locke. Locke vetoed a measure prohibiting illegal immigrants from paying in-state tuition rates at Washington colleges. Voter-approved measures the benefit schools and teachers will likely be suspended, which will no doubt lead to criticism from educators, teacher unions and parents.
Wyoming: Wyoming's Legislature adjourned in March and this month received a "C" grade from the Wyoming Economic Development Association. The group said the middle-of-the-road mark illustrated a sharp split on the question of how the Legislature views development issues. They also concluded that some lawmakers who say they are all for growing the economy turn right around and vote against bills the association sees as important to growth. The best thing the Legislature did in the past term was take steps to revive the Wyoming Natural Gas Pipeline Authority with the aim of increasing the price of gas produced in the state and shipped around the West.
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