Modest rise in revenues won't solve state's budget challenges

November 13, 2012 10:17:00 AM

Jeff Clark - [email protected]


Gov. Phil Bryant and state lawmakers begin their second day of preliminary budget talks today in Jackson. During Monday's discussions, Bryant and the Joint Legislative Budget Committee agreed on a 1.1-percent increase in revenue estimates for the current year, which ends June 30. They also agreed on an additional 2.5 percent increase in the estimate for Fiscal Year 2014, which begins July 1. 


"We're just in the preliminary process of getting our budget ready for next year," said Sen. Terry Brown (R-Columbus). "We met with Gov. Bryant and the lieutenant governor and the state economist and our budget experts. When we last met a few weeks ago, we were told Mississippi may be going into a recession. Now, it looks like we are not going into a recession, we are just staying flat. This means we are conservatively looking at having a budget of $5.4 billion-to-$5.5 billion for next year. But this number is a moving target. We will be meeting all week, so it could spike up a bit or spike down a bit." 


Brown said the small increase in revenue estimates is good news, but the increase may not be enough to fully fund all programs. 


"We certainly love to grow," Brown said. "But to fully fund everything at a comfortable level, we need to grow three to four percent." 


With the national economy still recovering from a 2008 recession, Brown said Mississippi is slowly emerging from the financial quagmire. 


"If you look at history, Mississippi is the last to feel the effect and the last to come out of it," Brown said. "We don't feel it as badly and we don't come out of it as quickly. There are other factors, too. People are really concerned about Obamacare and how it's going to work. It's the 800-pound gorilla in the room right now. People don't know how it will affect them." 


As the state continues to have a nine-percent unemployment rate, Lowndes County's latest numbers have it slightly above the state average at 9.7 percent. Brown said this is something that will be on his mind as today's budget talks shift to appropriations for all state agencies, including its economic development arm, the Mississippi Development Authority. Brown said he hopes the newly announced industrial development partnership between Lowndes, Clay and Oktibbeha counties will help with job creation. 


"I think this a great idea," Brown said. "We are used to economic development on a county-by-county basis. We're now looking more at regional development -- it just works better. I think a good example is the PUL Alliance, which is when Pontotoc, Union and Lee counties came together to bring in the Toyota plant to Blue Springs. It worked great because everybody brought something to the table. You'll see where locals have to have more skin in the game than ever before." 


On Wednesday, Bryant will release his spending recommendations for education, health care and other state services for Fiscal Year 2014. Legislators release their recommendations Dec. 11. Both plans will be debated during the legislative session that starts Jan. 8. The House and Senate face an April 1 deadline to adopt a final budget. 


This story contains additional reporting by the Associated Press.