Arizona lawmaker says shelved state budget cuts go back on table without more stimulus money

Ariz. lawmaker: Cuts a must without stimulus cash

PHOENIX — Congress’ rejection of proposed additional stimulus funding for states means Arizona would have to resort to painful budget cuts thought to be have been averted when voters approved a temporary sales tax increase, a key legislator said Thursday.

Without the federal funding, “we will have no choice but to implement some of the contingency cuts that we have identified,” said state House Appropriations Chairman John Kavanagh, R-Fountain Hills.

Arizona lawmakers expected to get $400 million of additional stimulus money when they approved the budget for the fiscal year that began Thursday. The money was tabbed to pay for health care for more than 300,000 Arizonans now provided health care by the state’s Medicaid program. The federal health-care overhaul prohibited the state from reducing the program’s enrollment.

Voters in May approved a one-cent, three-year sales tax increase to help close budget gaps in the just-started new fiscal year and the next two.

Defeat of the measure, Proposition 100, would have automatically triggered budget reductions that state officials said would force layoffs of state police officers, bigger school classes sizes, closure of some prisons and cuts to payments to health-care providers, driving some out of business. The university system would have lost funding equivalent to the budget for Northern Arizona University.

It’s that list that may have to be resurrected, Kavanagh said.

The possibility of not getting the additional stimulus money and other circumstances add up to a possible shortfall of up to $1.2 billion in the $8.5 billion budget, according to a recent report by legislative budget analysts.

With several uncertainties at play, it’s too early to react to the possibility of not getting the stimulus money, Gov. Jan Brewer’s budget director’s said Monday.

“Is this particular risk mature enough that we have to take action? I don’t think so,” Arnold said.

Arnold acknowledged that any cuts required by lack of money to pay for health care would largely fall on other state programs.