Arizona lawmakers and state officials often talk about a constitutional requirement to adopt a balanced budget. That simple statement can be somewhat misleading, because there’s no way to really know if a budget is balanced under the state’s accounting system until the fiscal year is over and there’s a final tally of revenues and expenses.
The state constitution even anticipates a situation in which unpredicted expenses push the state budget out of balance when those tallies come in. Article 9, Section 4 authorizes the Legislature to imposes taxes that cover such potential deficits and also will balance the budget for the next year as well.
A new report from staff for the Joint Legislative Budget Committee makes it clear that the state now is in violation of that provision, and likely a second mandate in Article 9, Section 5, which limits state debt.
The report was prepared in response to Gov. Jan Brewer’s final actions on the 2009-10 budget last week, which included vetoes that bring back a statewide property tax and that restore funding for K-12 education and the Department of Economic Security. In essence, the JBLC report says a 2009-10 budget that was balanced when adopted by the Legislature now is predicted to have $464 million in deficit spending because of Brewer’s vetoes. The Legislature still could act on that problem before June 30 and wipe out the pending deficit.
But the JLBC report also notes that the last fiscal year concluded with a $500 million deficit, despite earlier rounds of funding cuts and other maneuvers. The current budget has no provisions to address that deficit, which also qualifies as debt because the money has been committed and is owed to someone.
Brewer could fix last year’s deficit on her own by directing federal stimulus money to cover it. But that would reduce even further the amount of federal money available in case this year’s budget stays in the red. Don’t even ask about the potential deficits for the next budget on the horizon.
Arizona’s courts have basically ignored the state debt limit for years — allowing state and local governments to enter various borrowing schemes including the sale of bonds and lease-to-purchase of state buildings. My guess is the judges also would treat the ongoing budget deficit as a political problem that can’t be solved with a court ruling.
But it’s still interesting to note that Arizona lawmakers still haven’t accomplished their one official task under the constitution.
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The state will never be in balance as long as there’s out of control spending. ASU is a perfect example. The building goes on and on and on. When will Michael Crow stop constructing his empire at the taxpayer’s expense? The state is broke and ASU continues to funnel money into a boondoggle.