Unfortunately, Ohio's bleak fiscal situation is not unique. With the economy weakening, sales, capital gains and income tax collections are falling well below projections while unemployment has risen in nearly every state. Almost every day last fall, it seemed, some governor somewhere was announcing millions of dollars' worth of hiring freezes and highway and capital project cuts, imposing furloughs on state employees or floating the idea of raising or expanding sales or other taxes. Moreover, the executive branch was waiting for legislatures to enter into session to address the need for larger, more systemic cuts or revenue increases. "I think there is only one issue for us right now, the size of the budget hole we have to climb out of," says Chris Cummiskey, assistant Democratic leader of the Arizona Senate. "Everything else is secondary."
Finding places to cut the budget or dipping into tobacco-settlement or rainy-day funds won't be the only concerns before legislators this year, of course. Just as prominent will be the state-level response to terrorism and security concerns. Border states such as Arizona will look to beef up border security. California has already stepped up its security at major bridges. Every state will want to protect its major government facilities, airports, power plants and water supplies. In addition to problems of security, states will be revisiting public- health laws, making more explicit the power to impose large-scale quarantines, mandate vaccinations and seize property.
Given budget weaknesses, finding ways to pay for this heightened state of alert will eat into other, already-strapped programs. "As for extra dollars, you are talking about big money," Anna Cowin, head of the Florida Senate Appropriations subcommittee that funds public safety, said at a recent hearing on port security. "I don't see any money available."
Higher education represents the largest discretionary spending item in state budgets, but public colleges and universities are already oversubscribed, and lawmakers will be wary of cutting too deeply into these prime training and economic development centers. Construction of that new science center or student union building, however, has probably already been put on hold. Innovations at the primary and secondary level, meanwhile, will suddenly seem less important than simply keeping the lights on and keeping kids in school for a full- length term. Governors and legislators will try to spare K-12 education from the cuts that will otherwise range across the board.
Reforms in other areas may suddenly be sacrificed due to the need to pay for security and still make budgets balance. After the presidential race in 2000, everyone talked up the need to replace aging balloting equipment. The problem was always how to pay for modern machinery. Congress is still dithering over a $3 billion aid package, and any extra funding for voting machines at the state level has probably dried up. Welfare reform, too, will likely be put on hold. States are awaiting federal reauthorization of the welfare law and, with it, knowledge of what size block grants they'll be receiving over the coming years. In the meantime, welfare rolls are increasing due to the hard-up labor market. More families are going to need cash assistance, which will deplete funds for non-cash programs such as child care, which now accounts for one-fourth of Temporary Assistance for Needy Families (TANF) spending.
Other issues will inevitably come to the fore one place or another. The search for ways to combat sprawl and to streamline state sales tax laws will continue. States will still address controversial social issues such as gun owners' rights, abortion and tobacco regulation. Redistricting--either the drawing of new political boundaries or the defense of them in court--will still require a lot of energy in many states. Hundreds of state legislators will be running for reelection, competing for attention with the three dozen gubernatorial races this year.
But nothing will demand as much time and effort from state elected officials as keeping budgets in order. "Right now, the budget items are just all-consuming here," says Ohio Senate president Richard Finan. "People don't want to talk about much else."
