One of the biggest storylines in state politics in 2009 is likely to be at or near the top of the list in 2010.
State revenues have failed for 15 consecutive months to meet estimates. The budget for fiscal year 2010 has already been cut twice and it is a guarantee it will have to be slashed again before the fiscal year ends June 30.
Last September, Gov. Haley Barbour ordered $172 million eliminated, primarily from the state’s education programs.
Earlier this month, Barbour ordered another $54.3 million slashed from state spending, bringing the total loss for FY2010 to $226 million. In the first five months of FY2010, tax collections were 9.36 percent, or $172.5 million below estimates.
“Our budget situation is tough like every other state’s fiscal outlook,” Barbour said in announcing the second round of cuts on Dec. 4. “There is no indication that our tax collections will improve anytime soon. Therefore, I do not believe this is the last time I will have to reduce state spending this year.”
December’s cuts came just 18 days after he released his executive budget recommendation for FY2011, which starts July 1.
Barbour’s proposal calls for a major restructuring of the state’s education system.
The state’s public school districts should be reduced from 152 to 100, Barbour said, in an effort to save $65 million in fiscal year 2012, as state revenue continues to plunge.
The reforms reach into higher education, too. Barbour’s budget plan proposes that the Mississippi University for Women merge with Mississippi State University, and for Alcorn State University and Mississippi Valley State University to merge with Jackson State. In each instance, the campuses of the schools eliminated would remain open, but carry a new name. Barbour estimates those moves will save the state $35 million in FY12.
Revenue in fiscal year 2011, which starts next July 1, would come in $715 million under appropriations for FY10. The predicted shortfall for FY12 is over $1 billion.
“These are major changes for a significant new direction,” Barbour said in November.
School district consolidation and university mergers have historically been dead on arrival when the ideas reached the Capitol. Rep. Kelvin Buck, D-Holly Springs and chair of the House Universities and Colleges Committee, has said any bill that includes merging the state’s historically black universities would not make it out of his committee.
“I would disagree with the governor or anyone who would suggest that closing universities or reducing access and opportunity to a variety of educational course options is the way to go,” he said.
FY2011’s budget outline was further defined Dec. 15 when the Joint Legislative Budget Committee adopted its recommendation.
Like Barbour’s, the JLBC’s outline seeks to cut every eligible program and agency in an effort to save money as state revenue continues to decline.
Unlike Barbour’s plan, the JLBC does not recommend the merger of the state’s three historically black universities or the merger of Mississippi University for Women into Mississippi State.
What it does call for is leaving 3,600 unfilled state government positions vacant, spending $90 million of the state’s rainy day fund, and appropriating 100 percent of available state revenue, instead of using the 2 percent set aside.
The fiscal troubles of 2009, as bad as they were, did not result in mass layoffs at state agencies or the wholesale elimination of services they provide. With money from the American Recovery and Reinvestment Act propping up critical functions like education and Medicaid, the state was able to weather the storm relatively soundly.
With stimulus money scheduled to disappear the next two budget years, the hand-wringing of 2009 could turn into an outright pity party in 2010.
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