Cash-starved budgets make this year one of delay

Furious budget battles in states around the country are forcing lawmakers to work well past the end of their regular sessions, and some say the compromises emerging so far ignore long-term solutions to states' deep-rooted financial troubles.

The delays and gridlock come as no surprise to many lawmakers, since states overall are struggling with their worst fiscal crisis in decades. Some compare it to the years of the Depression.

In many states, little other work besides the budget is getting done.

"It's very, very difficult," said Washington state Rep. Bill Fromhold, vice chairman of the House budget-writing committee, where a predicted $2.6-billion deficit over the next two years has made for tough fights even within the major parties.

"The breadth of differences -- they're emphasized to a greater extent when you're facing these kinds of financial challenges," said Fromhold, a Democrat.

Today, he and his fellow lawmakers will gather again for an extended legislative session to try to settle on a spending plan. A special session begins today in Florida, while Arkansas and North Dakota finished overtime sessions last week.

Elsewhere, so far this year:

Idaho, sparring over a sales tax increase pushed by GOP Gov. Dirk Kempthorne, held its longest legislative session ever before compromising in early May. "The most difficult session," Kempthorne declared it.

Arkansas's GOP Gov. Mike Huckabee warned the legislature would force a government shutdown if it couldn't agree on a spending plan. Lawmakers overcame a $110 million shortfall by tapping state trust funds and raising income and tobacco taxes.

South Dakota lawmakers ran past midnight on the session's final day for passing bills in early March, patching together a budget with a flurry of agreements on reducing employee raises and raising taxes on cigarettes and cell phone companies.

GOP Gov. Mike Rounds questioned the validity of the budget because the legislature went into a new day to pass it, but legislators argued a "legislative day" wasn't the same as a calendar day. The courts said the budget was valid.

The next fiscal year begins in July for all but four states. By law, every state but Vermont must pass a balanced budget -- even if the economic assumptions eventually don't work out.

Financial analysts estimate that, overall, states have faced $78 billion in expected shortfalls for the coming fiscal year. Lawmakers have been cutting spending, borrowing money or raising revenue to overcome all that red ink. And next year could well be the fourth straight of weakening revenue.

Lawmakers in several states said they're worried they've only plugged budget gaps momentarily, and haven't put their states on track to financial health.

'We have failed'

"We have failed ... at our most important task, putting our fiscal house in order. You should not feel comfortable going home," Maryland state Delegate Howard P. Rawlings told colleagues last month.

While lawmakers balanced next year's budget, Maryland still faces a projected deficit of up to $1 billion in the fiscal year that begins in July 2004.

Every year, budgets bring out the worst of brinksmanship in lawmakers and governors, who often wait until the session's last days to compromise.

Each state also brings unique problems to the table -- freshman governors in Georgia, South Dakota and Maryland at loggerheads with lawmakers; personality conflicts between leaders in the GOP-led Florida legislature.

This year's money woes are making compromise even more elusive. They've also pushed into the background other work, whether it's changes to health care or insurance.

Kempthorne, who championed tax cuts in his first term as Idaho's governor before winning re-election last year, said this year was "a test of wills." He vetoed several of the legislature's appropriations bills before he won agreement on his temporary tax increase.

He's confident that it will get the state through what he predicts will be two full years of recovery, though he offered a warning for other states that rely too heavily on one-time money:

"The states that do not take corrective action now and wait until next January are going to be in even tougher shape."