Budget office asks for impact of cuts up to 10 percent

The state budget office has asked agencies to spell out what they would do to make cuts as deep as 10 percent as a worst case scenario. The memo from Director of Administration Andrew Clinger follows a similar request made two weeks ago asking for scenarios to make a 1.4 percent cut and a 3 percent reduction in General Fund spending.

This time, he said, he has asked for three additional scenarios: 6 percent, 8 percent and 10 percent and ordered those plans submitted to his office by the close of business Jan. 5.

Altogether, a 10 percent cut would require agencies to reduce their already tight budgets by a total of $436.5 million over the biennium.

The planned budget cuts would be implemented March 1, with only four months left of the fiscal year. Even so, 10 percent would cost the university system $16.7 million this year, Health and Human Services $29.7 million and public schools $40 million.

In fiscal 2011, a 10 percent General Fund cut would cost the university system $50.1 million, Health and Human Services $102.4 million and public schools $126.7 million.

Clinger said hopefully cuts those deep aren't necessary, but the latest statistics from his office show revenue collections $67 million behind budgeted amounts after just the first three months of this fiscal year.

"We've been looking at this since the close of (the legislative) session," he said. "Given our experience over the last two years and going through this, we don't want to do the budget cut of the month."

"I'm looking for three different scenarios because what you do at a 10 percent cut might be much different than what you do at 6 percent," he said. "They could be completely different plans."

He said he is trying to plan ahead so the state is ready to act when the Economic Forum issues new revenue projections.

"We can't sit back and wait until the number comes out in January. We want to be prepared when that number comes out, whatever it is, to move quickly."