Many states plan budget cuts because of attacks

More than a half-dozen states are moving to cut their budgets, as already weakened government finances suffer the aftereffects of the terrorist attacks. Many more states are trying to assess the damage from Sept. 11.

Illinois has put a freeze on hiring workers for most government jobs, while Maine may scale back on travel and new supplies. In Florida, a program that gives poor seniors $80 a month for prescriptions is one of many that agencies say they may have to cut.

"Sept. 11 did a number on the economy of every state in this nation," Arkansas Gov. Mike Huckabee said, warning of the potential for deep cuts as the fiscal year progresses.

Still stable

He and some other governors said their economies have taken a hit, but are still stable. No immediate cuts or reductions are planned in Arkansas, West Virginia or New Hampshire.

Governors elsewhere saw a very different financial picture, with steps such as:

Up to $1 billion in cuts in Florida.

Up to $1.6 billion in cuts and other budget changes in Arizona.

Up to $1 billion in cuts in Washington state.

Michigan estimates up to $900 million may need to be cut from state and school budgets; Maine is looking at $10 million; Connecticut at $88 million; Illinois at the hundreds of millions.

Re-examining finances

In many more states, agencies have been ordered to re-examine their finances and identify potential cuts. Among those states are California, Georgia and Indiana. Special legislative sessions focused on budget problems are scheduled in Arizona, Nebraska and Oregon.

New York is among those states still trying to assess the damage. A report by Democrats in the state Assembly estimated that more than 7 percent of the state's private sector jobs were threatened or eliminated by the attacks. Budget officials calculated at least $1 billion in lost tax revenues from the attacks.

"We need to really pare back government spending as quickly and as deliberately as possible," said Washington state Gov. Gary Locke. He froze spending on about $400 million in construction projects for college campuses and local school districts.

But most other proposed cuts in Washington state, and many of those proposed in other states, will wait until legislators approve them.

"We have a state budget that is hemorrhaging," Arizona Gov. Jane Hull said on Monday before meeting with legislative leaders.

Awaiting new reports

Number crunchers nationwide are waiting for new reports on sales and corporate taxes, and demands on unemployment and Medicaid, to get a fix on where their state's finances are headed.

"No one knows exactly what the Sept. 11 attacks mean," said Harley Duncan, executive director of the Federation of Tax Administrators. "But they know it's going to be more severe."

At the same time, political fights are brewing, too.

In Connecticut, Republican Gov. John G. Rowland released a list of $88 million in cuts, including two favorites of Democratic lawmakers: $12 million from a board looking at traffic problems, and $14 million from a mental health initiative.

"I would have looked at cutting the bureaucracy before I get into cutting new programs and services for people who need them," said Senate President Pro Tem Kevin Sullivan, a Democrat who is considering a bid for governor in 2002.