Make No Mistake--State Budget Will Shrink under Senate and House Proposals

The headline in The Seattle Times "State spending on track to rise, despite budget cuts" is a misleading way of looking at the state budget situation. If you’ve been following the budget debate, you know that both the Senate and House budgets propose deep cuts to education, health care, economic security, and so on.

State spending – from money the state collects --would actually fall under the two budget proposals. The article adds anticipated federal aid to state spending in order to reach the conclusion that the budget would increase.

However one treats the federal aid, the budget proposals would result in deep cuts across the budget, cuts that would come on top of the $3.6 billion in cuts made last year.

There are increases in spending in some areas. Most (over 70 percent) of the increases are maintenance-level changes. These are changes that are due, not to the creation or expansion of new programs, but to just adjusting to changing costs. When the Governor signed a balanced budget into law last year, it included assumptions about the number of people who would need health care coverage, the number of kids who would be enrolled in schools, the price of providing various services, and so on. Some of those assumptions turned out to be incorrect, primarily because the economic outlook has been worse than expected. Adjusting for those changes is generally considered as part of the maintenance-level budget and is not considered budget cuts or increases.

Aside from the maintenance budget changes, there are modest spending increases in both budgets. The largest items include a mandated correction in how the state calculates clinic reimbursements and reversals of cuts to nursing homes and adult day health in response to lawsuits.  The Times article points out one of the few areas where budget changes represent a significant change in the state’s commitments: sending unemployed workers to train at colleges for jobs in high-demand fields. This is spending that is both badly needed and woefully inadequate when compared to the demand. That’s a policy choice, but one that’s hard to argue with.

The bottom line is that neither the federal dollars nor the revenue increases are enough to fully offset the effects of the Great Recession. However, these sources of funding will help stave off other disastrous cuts such as those contained in the Governor’s first budget – the ones she said she didn’t have the conscience to adopt.