House, Senate far apart on budget

May 15, 2009



JACKSON -- House-Senate negotiators remain deadlocked in passing the state''s $19 billion budget as they argue over whether to squirrel away $60 million for another year. 


The Democratic House says the Senate is attempting an unlawful "slash-and-burn" budget approach that would force hundreds of state government employees being laid off. This would come as state government is getting millions of dollars in extra federal stimulus funds. 


"For us to start firing people while we have the money in the bank to pay them is just not good public policy from where we sit," said House Medicaid Chairman Dirk Dedeaux, D-Perkinston. 


The Republican Senate and Gov. Haley Barbour want to save some Medicaid money until fiscal 2011 to cushion the blow of an already-bad economic crisis getting worse. 


"A responsible budget must push as much money forward as we prudently and legally can in order to deal with the difficult fiscal prospects that await us, especially fiscal year 2011, which may be the worst year," Barbour said in a statement issued by his office. 


He said House leaders "remain blind to budget realities" and want to spend money as if it''s "manna from heaven." 


The state treasury for the coming year is getting about $443 million in federal stimulus funds to temporarily help Mississippi through the country''s worst recession since the 1930s. Most of the money must be earmarked for Medicaid and education. 


"The House wants to sweep up every dollar it can and spend it right now," said Senate Appropriations Chairman Alan Nunnelee, R-Tupelo. "I''m willing to make cuts in state government to avoid catastrophic cuts in 2011 and 2012." 


However, House Democrats say the Republicans are overreacting to Mississippi''s financial strains by trying to save so much money for another rainy day and depriving state services of funds needed now. 


"Sometimes saving money is counterproductive and creates risk," said House Education Chairman Cecil Brown, D-Jackson. 


He said the Senate''s spending plan would severely underfund public safety, education and health care programs. He estimated 2,000 of state government''s 32,000 employees could lose their jobs. To offset the loss of state funds, local governments and school districts could have to increase property taxes while colleges would have to increase tuition. 


On the other hand, holding back expenditures now would ensure Mississippi doesn''t get wracked with deeper budget cuts in subsequent years, said Senate Republicans. 


"If we don''t look ahead to 2011 and 2012 ... we''re going to be like the state of California," said Nunnelee, referring to the fiscal calamity that state is currently going through. 


During an hour-long public negotiating session Thursday, House leaders rejected the Senate''s plan to hold back the $60 million in a reserve fund. They said federal law prohibits federal stimulus money being set aside unspent for a rainy day. 


"Legally, a lot of the things you''re doing you can''t do," Brown told Nunnelee. 


They agreed to meet again next week or later after Barbour''s office gets federal guidance on whether the $60 million can be saved until another year. 


The legislative budget impasse appears so profound that the public should worry that state government won''t have money to operate when the fiscal year begins July 1, Brown said. 


"We haven''t gotten anywhere," he said Thursday after days of negotiating with his Senate counterparts. "The Senate seems to be set in stone on this $60 million." 


"We''re far apart and we''re running out of time," he said. 


However, Nunnelee expressed confidence a compromise will be reached by July. "I think we''ll get a budget," he said. 


The Legislature was supposed to pass all state appropriation bills by late March, but the House and Senate are in recess until May 26 to give negotiators more time to iron out their differences. 


In the middle of the legislative stalemate are state agencies, colleges and local governments wanting to know and plan for the amount of money they''ll have in six weeks. 


Interim state Higher Education Commissioner Aubrey Lucas said university leaders are anxious but can wait through May to know whether their schools'' budgets get increased or cut. 


"We understand the political process by necessity grinds slowly, so we try to be flexible in our planning," Lucas said.