Budget base shaky

2010-03-19T04:00:00Z Budget base shakyHOWARD FISCHER Capitol Media Services Arizona Daily Sun

PHOENIX -- The budget that Gov. Jan Brewer signed on Thursday is built on a series of assumptions about what voters -- and courts -- will do.

At stake is nearly $2 billion in either new revenues or spending cuts that will go toward filling a $3 billion budget gap.

The biggest assumption is the proposed 1-cent hike in the state sales tax, to 6.6 percent, that will appear on the ballot at a May 18 special election. Estimates show that would raise about $918 million in the first year of its three-year existence.

But lawmakers and Brewer also are counting on voters agreeing to scrap the First Things First program in November just four years after they had approved it.

That would give lawmakers access to the proceeds from the 80-cent-a-pack tax on cigarettes, which was part of the initiative to fund new programs for early childhood development, a levy that raises about $150 million a year.

It also would let them take an estimated $325 million already accumulated.

Also on the November ballot is a request to voters to let lawmakers take more than $123.5 million set aside to purchase open space around urban areas.

That OK is needed because the fund was mandated by voters in 1998.

And the Arizona Hospital and Healthcare Association is planning to challenge the provision that cuts AHCCCS eligibility, thus saving an estimated $385 million.

The requirement to provide coverage for everyone below the federal poverty level was part of a 2000 initiative. That, coupled with the state's economic slump, has ballooned enrollment to close to one out of every five Arizonans.

Legislative leaders said the language of the initiative lets them roll back the program because there are not other "available" funds.

But initiative backers, including the hospitals, contend the language forbids lawmakers from cutting eligibility.

'WE ARE BROKE'

Brewer, at a press conference to criticize the Democratic health care plan being considered in Washington, said the state had no choice but to eliminate free health care for more than 310,000 now enrolled in the Arizona Health Care Cost Containment System, the state's Medicaid program.

The budget also eliminates the Kids Care program that provides nearly free care to more than 40,000 children of the working poor.

The governor acknowledged that will increase the number of people in the state without coverage.

"We do not have the money," she said. "We are broke."

And what of the increase in the number of people who cannot afford health insurance?

"It is painful," she responded. "We cannot take care of everybody, every day, for every thing."

Pressed for where these people will get care, Brewer said she expects they will show up in hospital emergency rooms and clinics.

That is exactly what the Arizona Chamber of Commerce and Industry along with hospital officials told lawmakers would be the result.

More to the point, they said a large increase in the number of those who can't pay their bills will force hospitals to increase their costs to everyone else.

And that, they said, will drive up insurance premiums for employers -- potentially forcing them to stop providing coverage for their own workers and increasing the number of people without coverage.

'IT'S NOT EASY'

Brewer brushed aside that possibility.

"You know, it's not easy, is it?" she said.

Brewer said the $8.5 billion budget she just signed -- with $100 million in further spending cuts for this year and $1.1 billion more for next year -- represents a "comprehensive budget proposal" that balances the books.

"It is done," the governor said. "And we need to move forward."

Brewer said that even though the budget creates more uninsured, that does not make the health care plan being pushed by the Obama administration and awaiting a congressional vote a viable alternative.

"We can't afford the Obama offer," she said, claiming that, by her analysis, the plan would cost the state even more than it is spending now.

But Rep. Kyrsten Sinema, D-Phoenix, contended that the plan, if adopted, would save Arizona money in the long run.

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