By: Health Insurance
Submitted: 2010-01-03 13:12:58 | Word Count: 533
Most Arizonans do not understand how critical the state’s financial crisis is, District 5 Rep. Bill Konopnicki said.
The state has a $1.5 billion budget deficit for the current fiscal year and a projected shortfall of $3.4 billion for the next fiscal year, which begins July 1, according to a presentation by Gov. Jan Brewer.
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Brewer called an emergency meeting of her cabinet Monday and outlined extensive emergency measures that must be taken to help the state’s financial predicament. In her presentation, Brewer said the state has lost 40 percent of its revenue in the last three years while state spending nearly doubled in the last five years.
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Konopnicki believes the Arizona Legislature must use a four-pronged approach to balance the budget and bring Arizona back to financial health.
“The state will not be able to cut its way out of this problem,” Konopnicki said in an e-mail response to questions from the Courier. “There has to be policy changes, reductions in overhead, cuts to programs and increased revenue.”
He noted that Arizona borrowed $700 million in December “and spent it in 10 days.” According to Konopnicki, the state will have to borrow another $700 million in January to take state government through the month.
“If there is not an increase in revenue, the state could start issuing IOUs instead of checks. This was something California tried, but it did not work for them,” Konopnicki said.
The state could claim bankruptcy, according to Konopnicki, but he believes “we are a long way from that happening.”
He added that the Arizona constitution requires that taxes must be increased to cover the shortfall if the Legislature overspends its revenue.
Meanwhile, Brewer ordered several steps to be taken immediately to stem the financial bleeding, including the following:
• Additional contingency plans will be developed in anticipation of further state agency reductions.
• State agencies are to transfer money out of all eligible special line items to ensure they have sufficient funds to cover mandatory expenditures.
• The Arizona Department of Education and Board of Regents will notify school districts and universities to prepare for additional payment deferrals later this year — beyond those already budgeted.
• The Arizona Department of Corrections will return all non-violent criminal aliens to the custody of the U.S. Immigration and Customs Enforcement.
• State agencies must ensure that public benefits are only provided to those who are legally in the United States and reside in Arizona.
The governor said she is implementing a waiting list for KidsCare, the children’s health insurance program at Arizona Health Care Cost Containment Services.
The governor also called for an across-the-board 7.5-percent budget cut at all state agencies, including the Arizona Department of Corrections.
It is unclear how this cut will impact the Arizona State Prison-Safford, which operates Graham, Tonto and Fort Grant.
