Summary of Governor's budget proposal

This morning Governor Gregoire announced her 2011-13 biennial budget proposal. The governor's supplemental proposal will come out later this week and will start many of her proposed 2011-13 reductions early.

The General Fund-State deficit for next biennium (2011-13) is $4.6 billion, or $5.4 billion if you add in the $881 million ending fund balance. Gregoire's proposal makes $3.6 billion in reductions, suspends $1.1 billion in initiative spending and makes about $700 million in transfers from other funds.

Here's a summary of some of the major actions proposed:

Pensions/Compensation/Health Care:

• Eliminating the PERS/TRS 1 uniform COLA ($368 million)
• Cap the state’s contribution to higher education retirement plans ($57 million)
• Close the retire-rehire exemption in higher education
• Caps the state’s contribution for employee health care benefits to $850/month
• A late-breaking agreement with employee organizations (not yet ratified) calls for a 3 percent reduction in compensation, taken through more flexible arrangements than the current furloughs. This translates into about a 5.2 hour reduction/month. About 90 percent of the state workforce will be impacted. ($176 million)

Fund Transfers:

• Use of Rainy Day Account (Budget Stabilization Account) - $290 million
• Suspend GF-S Transfer to Education Construction Account - $204 million
• Extension of Liquor price mark-up - $85 million
• No reversions sent to Education Savings Account - $45 million
• Treasurers Service Account - $20 million

K-12:

• Eliminate K-4 enhancement ($216 million)
• Eliminated Highly Capable ($18.6 million)
• Suspend Initiatives 728 and 732 (the class size and teacher COLA initiatives) ($1.1 billion)
• Suspend annual bonuses for National Board certified teachers ($99.5 million)
• Suspend annual increment salary increases (steps) for teachers ($56.3 million)
• Suspend planned increase of all day K ($57 million)
• Delay implementation of new basic education formulas until the 2013-15 biennium – HB 2776 (about $710 million)

Higher Education:

• Continue 4.2 percent reductions from the current biennium to all higher ed institutions ($102.2 million)
• Reduce State Work Study program ($20.8 million)
• Suspend small scholarship programs ($15.6 million)
• Increase tuition by 11% at UW/WSU/WWU; 10% at community and technical colleges; 9% at other regional universities, and offset state funding with tuition ($344.7 million)

Early Learning:

• Reduce 3-year-old participation and re-direct some of that funding for 4 year olds ($9 million)
• Eliminate the Career and Wage Ladder Program ($3 million)

Health Care:

• Eliminate the Basic Health Plan ($230.2 million)
• Eliminate Disability Life Medical ($147.2 million)
• Eliminate the Children’s Health Program ($59 million)
• Eliminate Medical Interpreter Services ($11 million)
• Eliminate state funding for family planning grants ($9 million)
• Reduce optional Medicaid services such as non-emergency dental and maternity care to high-risk mothers ($48.2 million)
• Reduce grants by 50 percent to community health clinics ($12.8 million)
• Reduce local public health funding by 11 percent ($7.5 million)
• Reduce federal qualified health center funding ($85.1 million)
• Eliminate the Medicare Part D co-payments ($16.4 million)

Human Services:

• Eliminate the Disability Life grants ($180.1 million)
• Eliminate the State Food Assistance Program ($45.6 million – net; $15 million goes to food banks)
• Eliminate the child support pass through ($18.8 million)
• Eliminate state funding for refugee employment services ($10 million)
• Eliminate state funding for naturalization services ($5.6 million)
• Reduce in-home Medicaid personal care hours ($97.5 million)
• Reduce funding for 26,000 clients of community mental health services ($17.4 million)
• Reduce residential and outpatient chemical dependency programs ($14.1 million)
• Suspend mandatory training for home-care workers ($29.1 million)
• Increased fees for licensure of adult family homes, nursing homes, boarding homes, etc. ($15.4 million)

Public Safety:

• Close McNeil Island by April 2011 ($17.6 million)
• Close Maple Lane School by June 30, 2011 ($3.3 million)
• Eliminate Tolling for offenders on community supervision ($6 million)
• Eliminate the Auto Theft Task Force ($3.6 million)
• Reduce staff and programs in the Dept. of Corrections ($51.6 million)
• Reduce parole services for juvenile offenders ($5 million)

Natural Resources:

• Make the Parks and Recreation system self-funding ($47 million)
• Impose cost-recovery fees for water rights, commercial fishing, hydraulic projects, and silviculture burning permits ($11.3 million)
• Reduce funding for agricultural fairs ($3 million)

House Majority Leader Pat Sullivan released a statement saying:

“We will be carefully considering this proposal in the days and weeks to come. But any of the choices we make will have a serious negative impact on the social structure of our state, the education of our children, and the future of our economy. We are out of good options.

Clearly, we will pass a balanced budget before the session ends, just as we always do. And, just as always, it will not look exactly like the one the Governor has proposed today.

How it will differ I clearly can’t say at this point. But it is important to remember that our enemy is the recession, not the people of our state. The steps we take must reflect the kind of state we want Washington to be in the future.”