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House releases latest state budget proposal

Higher ed hit; levy equalization saved

The Columbian
Published: April 4, 2011, 12:00am

OLYMPIA, Wash. (AP) — The House of Representatives released Monday a proposed state budget for the next two years that includes $4.4 billion in cuts and privatizes state liquor distribution to bring in $300 million in revenue, slashes nearly $485 million from higher education, transfers $214 million in funds, and keeps health care for the poor and aid for disabled adults programs alive.

Monday’s budget proposal also deals with the last of this fiscal year’s deficit by delaying payment to schools by one day, pushing the $240 million due into the 2011-2013 budget.

State officials said that $37 billion is needed to upkeep the state’s responsibilities and payments for the 2011-2013 cycle. The expected revenue for that time frame is $32 billion. Lawmakers need to close the estimated $5 billion gap.

The current fiscal year, which ends in June, is also facing a revenue shortfall of about $370 million. That amount is the leftover of a $1.2 billion deficit that forced lawmakers to meet in a special session in December. Actions taken then, and in February, reduced the deficit to the amount reported Monday.

“There were some things we were unwilling to do, like eliminating the only safety net available for the poorest people who are unable to work and care for themselves,” said Rep. Jeannie Darneille, D-Tacoma, vice-chairwoman of the House Ways and Means committee, in a statement.

About $1.2 billion is saved by not funding two education initiatives that increase teacher pay and reduce classroom sizes.

The cut of nearly half a billion dollars from higher education is partly offset by increased tuition, legislative leaders said.

Under the House plan, the state would establish a competitive bidding process in which the state partners with a private company to handle the distribution side of the liquor business. The winning company would make a substantial payment to the state up-front — to the tune of $300 million — and then annual payments and profit sharing after that.

The House’s plan also halts automatic increase to state employee retirement plans to save $362 million, takes another $216 million from kindergarten through 4th grade class-size programs. Some $177 million is saved from cutting state employee salaries under the plan.

“The slow speed of the economic recovery is still having a significant impact on our budget and our job is to make the most responsible decisions we can in these tough times,” said Rep. Ross Hunter, D-Medina, chairman of the House Ways and Means committee. “This budget is responsible, thoughtful, and sustainable.”

The state’s Basic Health Plan, which is a health care program for the poor, and Disability Lifeline, which is an aid program for disabled adults, are saved in the plan. Gov. Chris Gregoire had proposed cutting those two programs in her December budget.

Under the House plan, though, Disability Lifeline will not include cash grants anymore, saving about $100 million. Enrollment for Basic Health is kept at 41,200 people.

The House budget aims to preserve the state’s health care program for poor children and levy equalization for school districts, a program in which the state subsidizes poorer school districts. Both programs were drastically cut under Gregoire’s budget.

“This wasn’t easy. We’ve said that from the start,” said House Majority Leader Pat Sullivan, D-Covington. “But we tried to provide a strong, sustainable foundation for our future by preserving key services while also reforming and rethinking the way we provide those services.”

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