UPDATE: Barbour makes 3rd round of Mississippi budget cuts

By Emily Wagster Pettus/The Associated Press

JACKSON — Mississippi Gov. Haley Barbour on Friday cut another 3.2 percent from what started as a nearly $6 billion state budget, but said he does not expect any drop in the quality of state government services.

Combined with previous cuts of 5 percent, most programs are losing 8.2 percent of their money during the fiscal year that ends June 30. Medicaid is losing 6.2 percent for the year because state law limits reductions in the government health insurance program for the needy.

Barbour cut $226 million from the overall state budget in the fall, and he said the total amount cut since July is $437 million.

“I cannot guarantee the public that this is where the cuts are going to end,” Barbour said during a news conference in Jackson.

He said state employee layoffs are possible, but he didn’t say how many workers might lose their jobs.

School superintendents and university leaders say budget cuts could hurt academic offerings. Tuition increases are expected in higher education.

Democratic House Speaker Billy McCoy of Rienzi said Barbour, a Republican, should’ve dipped into financial reserves to mitigate the cuts. House leaders also said that based on economists’ recommendations, the total cuts should’ve been limited to $347 million.

“It seems that the governor favors being as draconian as possible,” McCoy said Friday.

Mississippi has about $231 million in a rainy day fund, $221 million in a health care trust fund and at least $108 million in a hurricane recovery fund, said House Appropriations Committee Chairman Johnny Stringer, D-Montrose.

The recovery money is set aside in case Mississippi receives federal aid that requires the state to spend some of its own cash, but Stringer said there’s no federal requirement that Mississippi keep recovery money in savings.

The Democratic-controlled House voted earlier this week to require Barbour to take $50 million from the rainy day fund and $61 million in federal stimulus money and to limit the total cuts to $347 million. However, that plan failed when it stalled in the Senate.

Barbour had warned during the State of the State speech Monday that up to 4,000 inmates could be let out if legislators didn’t give him flexibility to cut some agencies’ budgets more than others.

He said Friday it’s unlikely that thousands of inmates will be released because some federal stimulus money could be put into the Department of Corrections budget.

Barbour said most Mississippians should see no difference in the services they receive from state government.

“In fact, often times when money’s tighter, you learn how to provide services better,” Barbour said. “That’s what businesses do every day, and there’s no reason that state government can’t do that.”

Barbour said the state’s 152 school districts collectively had about $500 million in financial reserves when the fiscal year started July 1. He said districts should tap those reserves.

However, House Education Committee Chairman Cecil Brown, D-Jackson, said many of the poorer school districts don’t have money set aside. He said 80 percent of schools’ budgets are spent on teachers’ contracts, and schools can’t stop basic services such as running buses.

“What the heck are they going to do?” Brown said. “Are they going to lay off maintenance workers?”

Barbour — who is limited to two terms and leaves office in January 2012 — has repeatedly said that he believes the state’s rainy day fund will have to last at least three years because no one is certain when the global recession will end.

Stringer said Barbour, who’s often mentioned as a potential 2012 presidential candidate, appears to be protecting a legacy.

“I think he wants to save it for when he leaves office to say, ‘Look how much I have,'” Stringer said.

A sharply divided Senate on Friday voted 26-22 for a bill that for two years would make it easier for state agencies to fire workers by removing civil service protections, including an employee’s right to appeal a firing. The bill also would give agency directors the power to move money from one part of a budget to another.

Opponents said removing civil service protections could make state workers subject to political whims by bosses.

“They want the authority to hold people’s jobs over their heads,” said Sen. John Horhn, D-Jackson.

Supporters said the changes would make it easier for agency directors to manage their budgets during the recession.

“We are simply applying the same business principles that are used each day in the private sector to help make state government more accountable, efficient and fiscally sound,” said Republican Lt. Gov. Phil Bryant.

The bill is expected to have strong opposition in the House because McCoy said state government should avoid layoffs if possible.

***

The bill is Senate Bill 2775.