Budget gap plans debated

Conservative think tank pushes cost-cutting ideas

BRAD SHANNON, THE OLYMPIAN

Originally published Sunday, February 3, 2002

OLYMPIA -- Rising Medicaid and school costs might widen the state budget deficit to $1.3 billion, dropping more tough choices on lawmakers who are struggling to find ways to make up the shortfall.

The state budget deficit might have grown another $50 million to $60 million, according to state Sen. Lisa Brown, chairwoman of the Senate Ways and Means Committee.

But many of the ideas The Washington Policy Center, a conservative, Seattle-based think tank, introduced Friday probably won't help the Legislature this year because the savings won't come in time, said Brown, D-Spokane.

"You're not going to solve a $1 billion problem this year by launching a new program," Brown said. "We're going to do efficiencies, and that'll close part of the gap. But a huge gap is going to remain."

So cuts to programs and increases in revenue probably will be needed when the Senate's proposed supplemental budget is released, perhaps on Feb. 25, Brown said.

Cost-cutting ideas

Daniel Mead Smith, president of The Washington Policy Center, offered a different view in a briefing for reporters.

Smith said $1 billion could be saved if the state took a half-dozen steps, including:

- Putting a flexible freeze on state agency hiring, which has swelled state- employee ranks to 102,000, up from 81,000 in 1990.

- Authorizing state Auditor Brian Sonntag to carry out performance audits to judge how well tax dollars are being spent.

- Opening state services to competitive bidding, including contracting with private companies for such services as Capitol grounds maintenance, printing, liquor sales and passenger service.

- Eliminating prevailing-wage requirements in school and highway construction jobs.

"I've said from the very beginning that everything is on the table," Brown countered. "We'll certainly have our staff look at the proposals."

Still, most of the savings recommended by the policy center wouldn't accrue until the 2003-05 budget cycle, Brown said.

Culture changes

"There's some short-term savings in here," Mead Smith said. "But we need to change the way government does business or we'll be right back in the same situation. ... We can't keep operating in crisis mode."

Some of the center's suggestions, such as privatizing liquor sales, contradict the finding of a governor's task force that found there could be problems with increased liquor availability and broken liquor laws if state agencies didn't manage the sales.

Parts of another proposal -- contracting out -- is included in the transportation efficiencies bill signed this week by Gov. Gary Locke.

But Rep. Cathy McMorris, R-Colville, said she thinks more should be done with other agencies, including the Department of Printing.

"What this report does is give us some areas where we might start," McMorris said.

In response to the hiring freeze, Brown said Locke's proposed budget already recommends cutting a net 440 state jobs.

As for job growth, Brown said, the growth rate has been slower than the population in all sectors of state government, except the Department of Corrections and higher education.

"If essential personnel are excluded from a hiring freeze, savings would be minimal," Brown said.

One other idea is to sell a 10-acre parcel the University of Washington owns in downtown Seattle, worth an estimated $285 million. The revenue from leasing the land now pays for UW construction projects.

Change in culture

A handful of lawmakers who joined Mead Smith and the study's author, Eric Montague, said the culture in state government has to change in order to win state voter trust.

The main thing is proving to voters that the state is getting value out of each tax dollar, said Rep. Glenn Anderson, R-Fall City.

The Olympian Copyright 2002

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