Posted by AzBlueMeanie:
Remember this fanciful headline in the Arizona Daily Star on April 1st (insert your own joke here):
Final legislative approval comes over objections of Senate Dems
State's 1st balanced budget in 5 yrs. OK'd
Link: State's 1st balanced budget in 5 yrs. OK'd. Howard Fischer of Capitol Media Services (formerly with the Arizona Daily Star back when it was a real newspaper) wrote "State lawmakers late Friday gave final approval to what will be the first truly balanced budget in half a decade." Not exactly.
Howard included the obligatory Democratic response: "Rep. Bruce Wheeler, D-Tucson, asserted the Republicans who crafted the budget aren't even being intellectually honest in claiming it is balanced. He pointed out that one of the ways they cut state expenses was to force some new financial burdens onto counties."
Turns out Rep. Bruce Wheeler is correct. The Star's headline was intellectually dishonest. You're shocked, I'm sure.
The Arizona Republic's AZ Fact Check tangentially challenges the Star's headline, er, House Speaker Kirk Adams' (R-Mesa) assertion, and calls bullshit:
What we're looking at
House Speaker Kirk Adams, R-Mesa, said lawmakers balanced the state budget for fiscal 2012 without any gimmicks, accounting tricks or borrowing.
The comment
"Today we can say — for the first time in a decade — that Arizona's budget is structurally balanced without relying on any gimmicks, accounting tricks or borrowing."
The forum
Guest column in The Arizona Republic on April 4, 2011.
Analysis
The $8.3 billion budget Gov. Jan Brewer signed on April 6 is balanced in that it proposes a spending level that matches what budget officials forecast will be state-tax collections in the next fiscal year. In fact, the budget anticipates a $5.2 million surplus at the end of the budget year.
But the budget also relies on funding rollovers, forced payments from local governments and fund shifts to come into balance.
For example, fund transfers total $274.6 million, according to the Joint Legislative Budget Committee's report on the March 31 budget deal.
These are dollars taken from various agency and program budgets — a practice that has been used in the past and routinely labeled as "gimmicks."
The budget reduces the amount of money cities and counties receive from the Highway User Revenue Fund, which is fed by gas taxes and vehicle-registration fees. Under state law, state government has shared these dollars with local government. In recent years, the state has shifted a portion of these local dollars to pay for the state Department of Public Safety.
That practice will continue in fiscal 2012, to the tune of $13 million that would have gone to the cities and $20 million for the 15 counties. That means $33 million less for local governments to use for road construction, maintenance and enforcement.
The budget also taps another $38 million of locally shared HURF dollars to help pay for the state Motor Vehicle Division: $26 million from the cities and $12 million from counties. This is a new maneuver.
In addition, counties will shoulder a greater share of the costs for housing prisoners at the Arizona State Hospital, which serves mentally ill patients. That will add another $2.75 million to the counties' obligation.
The budget also requires a $38 million contribution from Arizona's five most-populous counties: Maricopa, Pima, Pinal, Mohave and Yavapai.
The budget also has payment deferrals, typically called rollovers, for K-12 education, Arizona Health Care Cost Containment System, the Arizona Board of Regents and the state Department of Economic Security for a combined $1.3 billion.
Legislative leaders have noted, correctly, there are no new rollovers.
The budget also requires cities to contribute a combined $7 million to help fund the state Department of Water Resources.
Bottom line: Adams is inaccurate when he says the budget contains no accounting tricks and gimmicks. The package contains fund transfers, forced payments and rollovers. However, he is correct in saying the plan does not contain new borrowing.
No new borrowing is not the equivalent of a balanced budget. It is not. By the way, much of what the legislature attempted to do is contingent upon legal challenges to their actions. Arizona Capitol Times » A balanced budget… for now: Threat of lawsuits could undo spending cuts (subscription required):
[I]t’s also a risky proposition to depend more on cuts to the Arizona Health Care Cost Containment System — reductions that almost certainly will be challenged in court as violating the voter-protection clause in the Arizona Constitution.
If the critics of the AHCCCS cuts prevail, this year’s budget will have a $510 million hole punched through it.
“That’s why this budget isn’t real,” said Sen. Kyrsten Sinema, D-Phoenix.