February 8, 2011 Newsletter

Back to Work: the 2011 Session Begins A New Year, and a new session. The Legislature is back in session and hard at work building a balanced budget for the new fiscal year. We will also consider the merits of 1,000 bills that have been filed for consideration. The past two sessions were monopolized by difficult budget discussions, which made the sessions, seem longer and harder than others in recent memory. Thankfully the recession’s grip has begun to weaken and we are starting to see signs of economic growth. There is a light at the end of the tunnel, but we aren’t quiet out of the tunnel yet. Federal stimulus funds and other one- time revenue sources will dry up effective June 30, 2011. This leaves the State $313 million short of meeting our current commitments when the new fiscal year starts on July 1, 2011. In addition to these shortfalls, we have some areas of the budget with dramatically growing needs like public education, higher education, and Medicaid enrollment growth and Medicaid expansion due to additional federal requirements passed in last year’s Patient Protection and Affordable Care Act. The State still has approximately $210 million in our Rainy Day Fund, but obviously even if we utilized every penny in the fund, we would still fall short by $103 million dollars and the fund would be completely depleted. Given the stark realities of the budget numbers, it is likely further budget cuts will be necessary. Base budgets presented last week (the building blocks of our budget process) required each and every department to prepare for a 7% budget cut. This isn’t the final budget, but it helps us know what we have to work with when the final revenue estimates are presented to the Legislature in late February. My Democratic colleagues in the Legislature have floated the idea of running a deficit and suggest two possible tax increases as alternatives to budget cuts. To this proposal I say, “haven’t we learned from the folly of living beyond our means and using credit for on-going expenses?” The pain of budget cutting over the past two years has impressed upon me a very important lesson. Budgets MUST balance, on-going expenses and on-going revenue sources must be paired and credit should be used sparingly. Cutting budgets is hard, painful and dirty work; I do not relish the task. During the past two years, I have listened to many passionate pleas to fund various programs. Those of us in the hot seat forced to reconcile financial realities with imploring faces find few friends during budget time. The easy way out is to punt the hard decisions away to some future Legislature and to borrow money to keep everyone happy. It is a slippery slope and one need look no further than Congress to see that following the path of least budget resistance leads to an ocean of red ink. It might not be the politically popular choice, but I believe we need to live within our means. If our revenue growth doesn’t match budget shortfalls, then I believe we need to trim our expenses. Rainy day funds ought to be used judiciously since they are finite and non- renewing. We spent over half of the rainy day fund last year and have found it is still raining a year later. Who is to say we won’t still be drizzling next year or the year after? Not to mention further expenditures from the fund could jeopardize our AAA bond rating. We should use it only as a last resort in my view. In future articles and newsletters I will continue to keep you up to date on the budget process and critical bills being considered by the Legislature. Thank you for allowing me the opportunity to represent you at the Legislature. If you have questions or concerns about any issue before the Legislature, please feel free to contact me.