Budget gimmickry dug hole deeper for next year

Phoenix Business Journal
July 31, 2008
Kevin J. McCarthy

Ideally, when the state budget is passed each year, lawmakers and the governor can breathe a sigh of relief that the year's finance issues have been tackled.

Sadly, instead of tackling those problems, the fiscal 2009 budget punted them to future policymakers. In passing the most fiscally irresponsible budget in state history, the Arizona Legislature and Gov. Janet Napolitano aggravated the state's fiscal crisis in stunning fashion.

At one time, state budget deficits were closed through budget cuts or tax increases, or a combination of both. In recent years, those uncomfortable decisions have been sidestepped through a variety of gimmicks. Some budget maneuvering has become commonplace, but the fiscal '09 budget sets a record for irresponsible management. Faced with a $1.9 billion deficit between a "current services" budget and estimated revenue for fiscal '09, lawmakers and the governor finally came to an agreement days before the new fiscal year started. However, while the $1.9 billion deficit technically was erased, what remained was a structural deficit of $1.3 billion. Of that amount, $627 million is attributable to the gap between ongoing revenue and ongoing operational spending.