Archive for September, 2009

Day two of budget hearings reinforces a theme

September 22nd, 2009 No comments

Three more agencies brought their budget requests to the Joint Legislative Budget Committee this morning, and all three received the same message other agencies got yesterday: There just isn’t a whole lot of money to go around.

State Treasurer Tate Reeves led off the day’s proceedings with a $3.3 million request, which is about $296,000 more than his office got in fiscal year 2010. The extra cost, Reeves said, would fill two new positions in his office and pay for the purchase and repair of technology to track the state’s finances.

As he has with every agency that requested an increase in money, Senate President Pro Tem Billy Hewes, R-Gulfport, asked for a justification.

Reeves was ready.

“You can’t just look at FY10 versus FY11,” he said. “My agency took an 18 percent cut (in FY10 compared with FY09) while other agencies took a 6 percent cut.”

Budget numbers back up Reeves’ claims. In FY09, Reeves office received $3.55 million. In FY10 the Treasurer’s office got $3.024 million.

Secretary of State Delbert Hosemann asked for a 4.7 percent decrease, prompting Hewes to jokingly ask if there was something wrong with Hosemann.

“We’re just doing a lot more with the same people,” Hosemann responded. There were several potential revenue streams for the state that were not included in Hosemann’s $12.5 million request. One involved Hosemann’s signaling that he would push the Legislature to pass a law that required limited liability corporations to register annually with his office. Currently, only corporations have to file annual updates. LLCs only have to register when they’re formed, and aren’t required to file after that. Hosemann said the measure would protect consumers.

“(Unregistered LLCs) become a vehicle for people to hide things,” he said, citing the trouble some cemeteries and funeral homes have found themselves in with their pre-need insurance.

Ed LeGrand, the executive director of the Department of Mental Health, asked for $50 million more than the agency received in FY10, but the vast majority of that is comprised of federal stimulus money and increased state obligations to Medicaid-funded services at the state’s 15 community mental health centers. At a minimum, LeGrand said it would take $10 million of that $50 million for the CMHCs to operate at the level they are now.

“I don’t anticipate” that the full $50 million will be allocated, LeGrand said.

Senate Appropriations Committee Chairman Alan Nunnelee, R-Tupelo, said even rounding up the $10 million would be “very difficult.”

LeGrand said he was “cautiously optimistic” that Congress wouldn’t allow the state departments of mental health to “fall off a cliff” when it came to the disappearance of stimulus money and the modifications to Medicaid matching rules.

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More fake Viagra in the Delta than money in the state’s bank account

September 21st, 2009 No comments

Mississippi Attorney General Jim Hood told the Joint Legislative Budget Committee this afternoon that there was a warehouse in the Delta full of counterfeit Viagra, but his consumer protection division was having a hard time working up a case.

“We can’t get any witnesses,” Hood said. “Everybody wants to remain anonymous.” The story drew laughter from committee members and the audience gathered to watch the budget hearings that are the first steps in preparing the fiscal year 2011 budget.

The forecast for the revenue that will fund the budget, which takes effect next July 1, is a little less entertaining.

Four agencies had their turns to make their budget requests today, and all of them were told variations of the same thing: There is very little — if any — chance that anybody will receive even a tiny increase in the funding they got this  year.

Hood’s office requested what amounted to level funding, or no increase to the $9.5 million it got in FY10.

“We hope we can stay where we are,” Hood said.

Mississippi Supreme Court Chief Justice Bill Waller presented what on paper looked like a 9 percent increase from FY10 to FY11, but Waller said the state’s courts were merely trying to return to the funding level they received in FY09, when they got about $6.5 million. The FY10 allocation was 9 percent less.

“We’ve got to keep the courthouses open,” Waller said, in response to a question Senate President Pro Tem Billy Hewes, R-Gulfport, asked about the justification for an increase when state revenue if down 14 percent in the first two months of the current fiscal  year. “We’ve got to have enough money to operate. It’s simple.”

Waller said the court system has already implemented a hiring freeze and has canceled pay raises for court administrators who have reached service and education milestones. The decrease from FY09 to FY10 will essentially “turn the lights out” on the court system two months before the fiscal year ends, Waller said, leading to layoffs.

Department of Finance and Administration deputy executive director Freddie “Flip” Phillips was conciliatory during his presentation to the JLBC. He admitted that he didn’t expect to receive a 9 percent increase in general fund money in FY11 the agency is requesting.

Sen. Alan Nunnelee, R-Tupelo, chair of the Appropriations Committee, told Phillips and his staff that adjustments to the state employee health insurance system would be one of his priorities when the Legislature convenes in January. Premiums, which the state pays in full for state employees, are set to rise 11 percent in FY2011 and another 17 percent in FY12. The two years combined would lead to an $83 million deficit in the fund the state uses to pay the premiums.

“I don’t think we can afford that,” Nunnelee said.

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Budget hearings begin today

September 21st, 2009 No comments

At 1:45 p.m. today, the Joint Legislative Budget Committee will start the first round of hearings that will shape the revenue for the budget for fiscal year 2011. FY11 starts July 1, 2010.

Nailing down the theme is easy: There is not a lot of money to go around. Compounding that is the disappearance of a lot of federal stimulus money next December, money that filled a lot of holes in this year’s budget.

The JLBC will hear from the state Personnel Board, the Supreme Court, Attorney General Jim Hood’s office and the Department of Finance and Administration this afternoon.

The hearings that will receive more attention than most of the others is when the state Department of Education takes the mic Wednesday morning, followed by the Division of Medicaid Wednesday afternoon.

Agencies typically show up to these things with a number that is purposely inflated, and almost always receive less than they requested.

Just how much less during a time when the current budget is less than three months old and has already been cut remains to be seen, but state economist Dr. Phil Pepper could offer an idea Thursday when he briefs JLBC members on the long-term revenue outlook Thursday afternoon.

The hearings will take place in the legislative conference room of the Woolfolk Building. The full schedule is here.

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Toyota betting $1 billion on recovery

September 17th, 2009 No comments

The horses for the regular edition of the MBJ are in the barn for the most part, but there’s some news to pass along before we turn our focus completely to tonight’s Georgia Tech-Miami game. (Magnolia Marketplace has never been a fan of ACC football, or the ACC in general, but that Georgia Tech spread option offense is fun to watch.)

Down to business:

The annual Toyotathon sales drive will have a little extra punch when it starts in November.

Toyota is spending $1 billion on a marketing drive designed to boost U.S. sales in the fourth quarter, which has traditionally been a strong period for all automakers. A company spokesman says that is a new record for ad spending in one quarter.

The spokesman goes on to say that Toyota is confident that the automotive sales market, which has been decimated during what is now being called “The Great Recession”, is on the brink of making a comeback.

It’s impossible to tell if Toyota’s gamble will pay off. But think back to last September, when the first wave of fear was strangling the economy, and a lot of folks were terrified that the U.S. was in a nosedive toward a depression. A lot of that fear is gone, and folks will argue until their last breath the reasons behind it, but the reality is this time last year Toyota would have not even considered spending such a huge sum of money on advertising and marketing in one quarter. Now they are.

And now let’s hope that everybody buys a Prius so we can get that plant in Blue Springs humming.

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Defense Secretary Gates makes major move on tanker contract

September 16th, 2009 No comments

The years-old fight between Northrop Grumman/EADS and Boeing to supply the Air Force with a new fleet of refueling tankers had a pretty significant development this morning.
Since Defense Secretary Robert Gates reopened the bidding due to a Boeing protest after Northrup Grumman had originally won it, his office had total oversight over the rebidding process. That is no longer the case, or as much of the case as it used to be (if that makes sense).
Gates has restored to the Air Force the control over the process it enjoyed before the Boeing flare-up. Gates did say in a speech at the Air Force Association trade show that his office will continue to closely monitor things.
This probably doesn’t provide any sort of advantage to either company as the rebidding moves forward. Northrop Grumman’s victory was greeted with a lot of high-fives in Mississippi, specifically on the Gulf Coast. Northrop Grumman plans to build the KC-45 Tanker in Mobile, which could spin off suppliers and supplier jobs — not to mention direct jobs — to the area. Over the life of the contract, the deal could exceed $100 billion.
George Freeland, the executive director of the Jackson County Development Foundation, couldn’t overstate its potential during a conversation with Magnolia Marketplace a couple months ago.
The details of Gates’ speech can be found here.

Brookings Institution likes Jackson

September 15th, 2009 No comments

A report released today by the Brookings Institution may offer a glimmer of hope that some sort of economic recovery is gaining traction.

Brookings analyzed the 100 largest metropolitan areas in the U.S., basing their strength on four factors:

• Percent employment change from peak quarter to the second quarter of 2009

• Percentage point change in unemployment rate from June 2008 to June 2009

• Percent change in gross metropolitan product from peak quarter to the second quarter of 2009

• Percent change in housing prices from the second quarter of 2008 to the second quarter of 2009

Of the 100 metro areas, Brookings listed the 20 strongest and the 20 weakest, relative to how they are weathering the recession. Jackson was among the 20 strongest.

The full list, complete with data from each area, can be found here.

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Hosemann releases 2009 Municipal Elections Report

September 14th, 2009 No comments

Secretary of State Delbert Hosemann released the 2009 Municipal Elections Report late this morning.

Essentially, the report outlines the questions, complaints and allegations Hosemann’s office received about the elections in Mississippi’s municipalities.

According to the report, the two biggest complaints voters had were precinct changes and their names not being on the voter rolls. Those issues accounted for nearly 25 percent of calls to the elections hotline Hosemann’s office had set up.

The runner-up behind precincts and voter rolls were allegations that candidates or their representatives were campaigning within 150 feet of a polling place, which is a no-no.

Neither of those is going to cause any great headache for Hosemann.

But this probably will: The report lists allegations of voter fraud in New Albany in a couple different forms. One accuses New Albany police officers of delivering absentee ballots to people’s homes and  instructing them how to vote. An addendum to that complaint says that absentee ballots marked for one particular candidate were given to New Albany cops to return to the voter with instructions to switch their vote.

Another claims the New Albany city clerk endorsed a candidate — though the report did not name who the candidate was or what office he/she was seeking — before handing over an absentee ballot to folks who had asked for one.

Obviously, Hosemann, attorney general Jim Hood and/or their agents either have already spent some time or will spend some time in Union County.

There could be other towns on the travel itinerary.

Similar stories from Macon and Canton are listed in the report, along with an array of other issues from across the state. The full report can be read here.

Categories: Delbert Hosemann, Elections, News, Politics Tags:

Looking back and looking ahead

September 14th, 2009 No comments

Pretty intense football weekend, wasn’t it? Georgia and South Carolina came down to the wire. Notre Dame lost to Michigan in the worst way possible, as did Ohio State to USC. New Mississippi State coach Dan Mullen’s first SEC game would have gone a lot better had Tim Tebow still been his quarterback. Ole Miss was in a slugfest with H1N1.

Magnolia Marketplace was unusually quiet last week, thanks to a combination of a server that has yet to behave the way it should, and a mountain of work on long-term stuff.

The regular edition of the MBJ published this week has a story about a former in-house counsel at Toyota who has alleged in a lawsuit that the company hindered his investigations related to rollover lawsuits from 2004 to 2007, altered some of his findings or destroyed evidence all together. Pretty serious stuff.

Toyota has filed a motion with the U.S. District Court in Los Angeles, where the suit was filed, to have the documents sealed. For now, though, they are a part of the public record, and there is some pretty inflammatory language coming from the plaintiff, who once was the architect of Toyota’s defense of the thousands of rollover claims.

In other Toyota litigation news, the Prius Hybrid, which is scheduled for production in Blue Springs at some point, is the star of a lawsuit Paice LLC filed against Toyota. It focuses on the the hybrid technology itself. This isn’t the first time Paice and Toyota have engaged in legal warfare. The two share an extensive history.

Also, Gov. Haley Barbour will hold a symposium focusing on healthcare and energy and will also unveil an initiative aimed at helping small businesses tomorrow afternoon at the Jackson Convention Complex. Staff writer Nash Nunnery will be there to provide coverage for the MBJ.

Categories: Haley Barbour, News, Politics, Toyota Tags:

Chaney addresses Stennis crowd

September 8th, 2009 No comments

I meant to post a reminder this morning, but the official server of Magnolia Marketplace was late to realize that the Labor Day holiday did not stretch into Tuesday.

Nevertheless, Mississippi Insurance Commissioner Mike Chaney keynoted today’s monthly luncheon of the Stennis Capitol Press Corps. Chaney hit on a number of things during his roughly 35-minute presentation that featured a slideshow. The biggest news, and it wasn’t really news, is that Chaney said there was “no way” the Mississippi Insurance Department was going to grant State Farm’s request for a 45 percent rate increase in homeowner’s insurance policies on the Mississippi Coast. Chaney had made that assertion shortly after the company formally asked for it a couple weeks ago.

The MID is also freezing some open positions, including those that would inspect mobile homes in the state, while the budget situation remains unsettled. Chaney did say that he would issue a request for proposals “in the next 14 to 21 days” to private companies to perform the inspections.

The rest of the Chaney’s time at the podium was spent running down the details of the State Fire Academy. Chaney, by statute, is the boss of it, and it looks pretty interesting. There are several cars and even an airplane submerged in a lake on the premises that act as training aids for rescue operations that require underwater maneuvering around cars and/or airplanes.

Pretty neat, right?

No surprise: State’s budget under the axe

September 3rd, 2009 No comments

In what Magnolia Marketplace all but predicted yesterday, Gov. Haley Barbour has announced he is cutting $171.9 million from the budget for fiscal year 2010. The cuts will affect almost every agency, including education. Spared were Medicaid, the Mississippi Department of Corrections and court-ordered expenditures and debt service.

Not every facet of the education budget came under the gun. The National Board Certification program and student financial aid line items remain whole — “for now,” Barbour said.

The National Board Certification program is significant. It pays teachers who meet the standards a $6,000 annual salary supplement. The program was up for debate during budget negotiations in May and June. Dozens of teachers showed up at the Capitol and, as you might expect, let lawmakers know they wanted to keep their money.

The fiscal year is barely two months old, and the budget is already smaller than it was when it started. The Joint Legislative Budget Committee meets later this month to begin drafting rough outlines for next fiscal year’s budget. Care to guess what the overriding theme will be?

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