OP-ED: Georgia Leaders Rising To the Challenge of Managing Budget in Hard Times

July 24, 2009

By Lt. Gov. Casey Cagle

We are all blessed to live in such an extraordinary state, but it is impossible to miss the frequent reports of worsening economic conditions exacerbating Georgia’s budget challenges. The latest announcement of an additional $900 million budget shortfall puts us in the unfortunate company of 47 other states that have addressed or face 2010 budget shortfalls totaling a combined $166 billion. Clearly, the same budget challenges that dominated the 2009 agenda will be the focal point for legislators and leaders in 2010.

I’m proud of the work the state Senate has done to anticipate these challenges. My office worked with senators as early as summer 2008 to assess the role of each state agency and work in partnership with agencies to make significant spending cuts. Our goal was to maximize the efficiency of government with the firm expectation that the state’s budget situation would not improve in the short term. Thanks to their cooperation, this comprehensive review of state spending allowed us to enter the 2009 session with the necessary facts and information to make many carefully targeted cuts that totaled over $2.5 billion.

Prior to the 2009 session, I made my legislative priorities clear: cut spending and balance the budget. I’m proud we were able to accomplish these goals, especially since so many other states faced with similar situations sought the comfort of creative revenue enhancements rather than face the harsh realities of their own spending habits. This year alone, 30 states have raised taxes and another seven are considering tax increase proposals.

States that did not take similarly aggressive action to prepare for this crisis are now working overtime to cobble together solutions. California’s budget challenges are now legendary, but it is certainly not the only state struggling. North Carolina legislators have been engaged in a three week long stalemate over their budget, while Connecticut and Pennsylvania are also operating without a budget. In Illinois, state vendors recently learned that over $3 billion in payments will be postponed, and in Ohio the legislature ground to a halt for weeks in response to a proposal to introduce slot machines at horse-racing tracks. Even in conservative southern states such as Kentucky and Arkansas, state leaders have already resorted to increasing taxes to balance their budgets.

In Georgia, by rising to the occasion and leading on principle, we have been able to avoid much of the political theatre and posturing that accompanies negotiations over a last-minute, makeshift budget. Unfortunately, even with the interim cuts announced this week by the governor, there can be no doubt additional action is required to align our budget with state revenue during the 2010 session and beyond. In the meantime, I am proud that Georgia Republicans are leading by example. The General Assembly will return about $3 million to the State Treasury that had been allocated but not spent as a result of conservative fiscal management by our members and my office. In addition, General Assembly members and I will be furloughed one day per month for the remainder of the year while our staffs will also be furloughed a number of days during that same period of time.

I am confident that when revenues begin to rebound, our efforts to cut waste in government, reduce spending, and avoid tax increases will pay great dividends. Georgia is the economic engine of the south and stands to gain the most during the eventual economic recovery if we continue to stay true to our conservative Georgia values and make strategic investments for our future.