LETTER: Lawmakers return; budget games have just begun

I commend the House and Senate leadership for taking a legislative break, an action I had recommended earlier, to bring a budget that is in serious chaos into balance, as required by the Constitution. Coming to grips with the problems caused by seven years of poor policies has been a very difficult task as some state bureaucrats and agencies have been less than forthcoming to Appropriations Committee members about their spending priorities.

Legislative budget writers are considering drastic actions in order to balance the budget. More personnel cuts will probably be necessary. Department heads are being asked for lists of employees who are fully vested in state pension benefits and could be encouraged to retire early.

Serving on the Appropriations Public Safety Subcommittee, we are considering the area of state government that should be our first priority. GBI crime labs, State Patrol posts and trooper positions are at risk of falling under the budget axe, which would have a serious negative impact on the criminal justice system in our state.

The most controversial budget proposal is a recommendation to slash $300 million from Georgia’s public colleges and universities. Having already cut $380 million from the University System budget since 2008, and the governor proposing to cut $265 million in his budget plan, further deep reductions would be painful for college students, faculty and staff and the state’s economy.

Constitutionally, the state legislature only appropriates a line amount of funding to the Board of Regents, and they are responsible for deciding how those dollars are spent. Upon discussion of these budget cuts, the Board of Regents played a political hand of its own, threatening to severely curtail or eliminate the 4-H Clubs and Cooperative Extension Services in Georgia’s 159 counties, knowing the negative reaction that would generate in a state where agriculture is the No. 1 business.

Gov. Perdue then held a press conference in which basically threw the legislative leaders of his own political party in the proverbial ditch by saying that under his administration, these cuts to higher education would not be made. While I am proud that he took a position, the real question now is, does the governor want the legislature to balance his budget or not?

The governor is forecasting a 4.2 percent growth in revenue for next year, despite the fact that state tax collections have declined for 15 consecutive months, including a 9.9 percent decrease in February, and are now down by 12.7 percent through the first eight months of fiscal year 2010. It has been estimated that the amended budget for this year will have to be cut by at least another $200 million to $300 million, and the 2011 budget is facing an overall shortfall of at least $1.5 billion.

The legislature has now returned to session, but I think another recess might be necessary to convince the governor that the budget he submitted is out of balance. While reducing state funding, we also need to eliminate the mandates on local governments and school boards so they can cut expenses without passing on the costs associated with those mandates to property owners in the form of higher taxes.

While the governor wants to increase spending, his office has also recommended a series of revenue enhancements, including a 1.6 percent tax increase on hospitals and a license fee increase on video gaming machines. A member of the Republican leadership in the House has introduced a bill that would legalize pari-mutuel wagering on horse racing to increase revenues.

Meanwhile, the Georgia Environmental Facilities Authority (GEFA) is apparently moving forward on Gov. Perdue’s proposal to sell off a loan portfolio package to investors, even though the General Assembly has yet to even vote on the plan. GEFA officials released a request for proposal to financial underwriters who would be interested in packaging the state loans as a security to be sold to investors at a significant discount. Bad mistake, selling your seed corn, short-sighted!

The governor’s version of the fiscal year 2011 budget includes $288 million from the loan portfolio sale, but if the loans are sold to Wall Street investors, there will be almost no funds available to make future water and sewer loans. Georgia’s city and county governments depend on the GEFA fund as a source for financing infrastructure improvements.

Stay tuned. Halfway through the legislative session, the budget games have just begun. This is a dandy time to clean up government waste, unnecessary spending, inefficiencies, private contracts and questionable programs so that the core mission of government can be accomplished.

Rep. Alan Powell (D-Hartwell) represents the 29th District (Franklin, Hart and Madison counties) in the Georgia House of Representatives. Contact him at 507 Coverdell Office Building, Atlanta, GA 30334; by phone at 404-656-0202 or by e-mail at alanpowell23@hotmail.com. For more information, visit www.alanpowell.net.