While the exact dollar amounts are still being calculated, the state budget passed by the legislature will have both direct and indirect effects on local agencies and residents.
The largest cuts include those to health care, universities and community colleges, and K-12 education. Education makes up the largest portion of the state’s general fund budget.
Cuts to the Arizona Health Care Cost Containment System (AHCCCS) total $510.7 million, while cuts to universities total $198 million and to community colleges, $72.9 million.
Budget cuts to K-12 schools across the state total $179.4 million, but a proposal to roll over payments due this fiscal year to the next in order to balance the budget on paper was eliminated.
According to Senate President Russell Pearce, legislators passed a budget that did not rely on “gimmicks” to balance the ledgers. In fact, legislators did not balance the fiscal year 2011 budget, but instead chose to end the year in the red and roll a $332 million anticipated deficit into the next year’s budget.
“The Senate budget used no gimmicks, no new rollovers and no borrowing,” Pearce noted.
The state budget does, however, pass on some costs traditionally borne by the state to counties and cities, and also reduces payments to those counties and cities. School districts will receive less state funding.
A plan to shift state prisoners to county jails as a cost saving measure was left out of the budget. Other measures that affect counties, however, were left in the budget. Money typically shared with counties to help cover the costs of constructing and maintaining roads will be shifted to the Arizona Department of Public Safety. County leaders have called the shift of costs to counties a different form of a budgeting gimmick.
“Since 2008, the State of Arizona has shifted responsibility for funding $193 million worth of state government programs and services at the feet of county taxpayers. In FY2011 alone, more than $77 million in ongoing state costs are required to be paid by Arizona’s fifteen county governments,” the Arizona Association of Counties notes. “The result has been an elimination of critical resources in every county; diminishing the ability of Arizona’s county officials to execute the constitutional and statutory duties they were elected to fulfill.”
In addition to shifting some costs to counties, the state budget also sweeps additional funds from the State Parks Department and Arizona Office of Tourism. Last fiscal year, the parks department shuttered some parks and struggled to keep others open. Through partnerships, however, a number of the parks were able to re-open. Homolovi State Park near Winslow was among the parks closed due to budget cuts, but was re-opened with funds provided by the Hopi Tribe.
Although negotiations are ongoing, it appears likely that the office of tourism will not receive any state funding in fiscal year 2012. Historically, the department has been funded through bed, amusement and bar taxes. Department officials argue that sweeping the revenues into the general fund hurts the state in the long run. The office cites studies showing that for every dollar put into the department, the state had a return of $2 to $3.
Total cuts in the state’s 2012 budget equal nearly $1.14 billion. The cuts represent a compromise between the budget proposed by the governor, which had fewer cuts, and a budget proposed by the senate, which had deeper cuts.
