Bredesen cuts include raises, TennCare, higher ed, schools

Bredesen cuts include raises, TennCare, higher ed, schools

By: AP

By ERIK SCHELZIG
Associated Press Writer
NASHVILLE (AP) — Gov. Phil Bredesen outlined a series of deep cuts to bridge a nearly half-billion-dollar hole in Tennessee’s upcoming spending plan during a speech to lawmakers Monday.
The governor proposed cuts to TennCare and both primary and higher education. Bredesen followed up on the plan revealed last week to use voluntary buyouts to trim the state’s work force by about 2,000 employees by confirming that he’s also eliminating a planned 2 percent pay raise.
Bredesen, a Democrat, said he will balance the budget without raising taxes. “We can’t tax our way out of this shortfall,” he said.
Despite the cuts, Bredesen wants to set aside $100 million to help Tennessee land unspecified economic development projects.
Administration officials won’t say which projects that money would target. But German automaker Volkswagen AG announced last month that Tennessee is among three states it is considering for a new assembly plant.
Tennessee’s revenue situation is suffering because “our economy is in a recession and energy costs are soaring,” Bredesen said in a somber 16-minute speech.
“Now that the magnitude of the problem is becoming clear, we need to act decisively and conservatively,” Bredesen said. “This is not a time for a lack of resolve, this is not a time for wishful thinking.”
TennCare, the state’s expanded Medicaid program, had been slated for a $100 million increase to help pay for up to 100,000 people in the “medically needy” category for low-income people with large outstanding medical bills.
That expansion would be cut by $80 million under Bredesen’s plan and would serve a maximum of 20,000 people.
Tony Garr, executive director of the Tennessee Health Care Campaign, was critical of the TennCare reduction — especially in light of the 170,000 adults that Bredesen cut from the expanded Medicaid program in 2005.
“This governor who was supposed to be able to manage health care, the only thing he knows to do is cut health care,” Garr said.
Bredesen’s budget plan would cover the inflation costs for K-12 schools. But it would include no new primary education money or add any pre-kindergarten classes around the state — a decision Bredesen called “a painful step for me but one that is necessary.”
The governor urged higher education officials not to respond to a $56 million cut in state funding by heaping large tuition hikes on students and their families.
Lawmakers had already been warned about the state’s bleak budget situation, so most expressed little surprise — or opposition — to the governor’s proposal.
“It’s going to be a tough budget, but it’s one we will be able to work with and we will be able to balance,” said House Speaker Jimmy Naifeh, D-Covington.
House Minority Leader Jason Mumpower, R-Bristol, called the budget cuts an “unfortunate reality of the economic cycle that we’re living in.”
Mumpower nevertheless praised the effort to focus on economic development projects.
“I think we need to do everything we can to recruit new high-paying jobs into this state,” he said. “In the world we live in today, part of that is offering economic incentives.”
Bredesen is aiming to cut $468 million out of the spending plan for the budget year that begins on July 1. The reductions also include one-time money for maintenance for buildings operated by the state, public colleges and universities, and prisons.
The governor is also eliminating a $10 million contribution to the Heritage Conservation Trust Fund for acquiring state park land and is cutting in half the money available for the state’s tobacco cessation program to $5 million.
State Health Commissioner Susan Cooper said she’s pleased that the governor kept the program to fight smoking alive. “We’re eternally optimistic because we can do some good things with the money,” she said.
Published in The Messenger 5.13.08

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