The California Journal of Politics and Policy (CJPP) is an online journal of original scholarship, cutting edge research, and informed commentary regarding all aspects of national, state, and local government, electoral politics, and public policy formation and implementation. Published by the Institute of Governmental Studies at the University of California-Berkeley, the Journal provides timely insights and historical and comparative perspective on issues ranging from legislative and electoral concerns to tax and social welfare policy, the courts, campaign finance, and the changing role and character of political media.
Volume 7, Issue 3, 2015
Western States Budget Report - 2014
Among western states, Alaska is the most dependent on oil/gas taxes. In late 2012 and early 2013 the its counter-cyclical economy puttered along while oil production (taxes from which provide 87 percent of the state general fund budget) continued to decline. The main fiscal issue during the 2013 legislative session was oil severance taxes, with Governor Parnell making his second attempt (with Republican support) to lower them in hope that the industry would increase its investment in the state, thereby increasing production. A solid Republican bias on the state's redistricting board led to the electoral defeat of Democrats in the Bipartisan Working Group that had fouled the governor's previous attempt. In April 2013 the legislature adopted the governor's plan. Inter-branch and government-public discussions about the operating, capital and supplemental budgets were generally congenial, with a decline in growth of the operating budget and a significant cutback in the capital budgets.
While Arizona’s Fiscal Year 2014 budget itself offered modest changes from 2012-2013, two budget policy areas became the battleground. With the re-election of President Barack Obama in 2012, the biggest lingering question in the Republican-dominated state government was what would happen with Medicaid expansion. Governor Jan Brewer chose the pragmatic path of seeking Medicaid expansion and eventually had to rely on Democrats for the votes to add it to the budget over leadership objections in both the State House and Senate. Meanwhile, efforts to reform Arizona’s complex sales tax system ran into opposition from cities and towns and ultimately a compromise became law.
Unlike his first budgets, Governor Jerry Brown began this budget cycle from a position of political strength. The Democrats controlled a 2/3 supermajority in both chambers of the legislature, allowing them to increase taxes without a single Republican vote. Voters approved Brown’s temporary tax increases in a November 2012 referendum, adding several billion in state revenue. The improved economic and political situations allowed Brown and Democratic lawmakers to broaden the debate over the 2013-2014 budget. The centerpiece is a massive restructuring of state money for K-14 education. In addition, Brown wants to continue paying down the “Wall of Debt”, the nearly $30 billion the state had accumulated over its previous borrowing spree.
This paper tracks the Hawai‘i state budget process during 2013, a time when the state's slow economic recovery was hampered by federal budget sequestration and the loss of US Senator Dan Inouye who excelled at steering federal funds to the state. The final budget reflected a few minor policy victories for Governor Abercrombie with the legislature leaning to the side of fiscal prudence.
This paper examines Idaho state budgeting decisions for Fiscal Year 2014 and assesses what progress has been made to return to the state’s revenue and spending levels before the hard times in 2009 and 2010 (Kinney 2010; Kinney 2011). After briefly describing Idaho’s population and politics, the report discusses the state’s economic and General Fund revenue contexts for budget decision making. It then analyzes the governor’s budget and the legislature’s appropriations and considers two important potential impacts of these decisions. Progress in Idaho state budgeting continued to be mixed. The state economy generally gained since the recession years although prospects for specific sectors varied. General Fund revenue collections increased regularly since the low point of FY 2010 but were still below the pre-recession amounts. “Progress” differed for the General Fund spending of individual General Fund departments and major programs. While the legislature’s spending shares increased for some functions and programs and decreased for others, we found no major changes in the shares for FY 2014.
Newly elected Democratic Governor Steve Bullock called for investing in Main Street, investing more in Montana’s education system, creating health care solutions that improve access for Montanans, and bringing high paying jobs to the state. The governor achieved few of his goals but the legislature did produce a balanced budget that addressed a variety of issues including Montana’s poorly funded state pension system, increased spending in a number of functional areas, provided $110 million in tax cuts, and left the state fiscally sound.
Nevada is experiencing structural change and a political tipping point. The 2010 Census and reapportionment of the Nevada Legislature are the significant factors producing permanent political change in Nevada. The political tipping point marks a permanent shift in political power from the north to the south, rural to urban, and Republican to Democrat. Redistricting produced a 2013 Nevada Legislature where 75 percent of the members of the State Senate are from Clark County and 75 percent of the members of the State Assembly are from Clark County. The 2013 Nevada Legislature faced a Nevada economy that hit bottom, was flat in 2010 and 2011, and is now experiencing slow growth. Republican Governor Brian Sandoval was committed to the formulation of a balanced 2013-2015 biennial budget based on modest increases in state spending, no tax increases, and no new taxes. Many Democrats in the Legislature favored a tax increase and the enactment of new taxes. Republicans in the Legislature, along with Governor Sandoval, were unified and successful in their goal of enacting a balanced 2013-2015 biennial budget that was balanced without significant tax increases or new taxes.
Though presidential politics and demographic trends show New Mexico turning a deeper shade of blue, its Democratic Legislature and Republican Governor danced to the political and fiscal center in the 2013 legislative session. They advanced similar budgets and focused on similar policy areas while continuing to disagree on longstanding political fights. Whether it was tighter party ratios in the state senate or a governor with an eye toward reelection, the 2013 legislative session was less acrimonious and more accomplished than many a recent session. This paper exams the political and economic landscape of New Mexico in 2013. First it will address the legislative and political changes brought about by the 2012 general election. Then, it will provide an overview of the more important legislative issues considered by the New Mexico Legislature. Finally, it will consider the legislature’s annual effort to pass a comprehensive state budget for the fiscal year beginning on July 1, 1013.
By the 2013 Legislative Session, the worst of the Great Recession was over. For the first time in several years, Utah was not facing a financial crisis and lawmakers could afford to debate subjects that did not revolve around averting disaster. With almost half a billion in new funding, legislators focused on the policy area the majority of Utahns consistently identify as a high priority – education. Considered by many a subdued session, many bills that could have proved controversial were shelved and lawmakers opted for interim studies rather than large appropriations. While the session was considered largely uneventful, legislators were challenged with responding to an investigation of the state Attorney General and passed several bills accordingly. Overall, the 2013 session marked the beginning of a return to fiscal health in Utah, and legislators could once again focus on issues beyond managing the budgetary stress and fallout from the recession.
The Washington State budget is between a rock and a hard place, challenged by a slowly recovering economy and the State Supreme Court's McCleary decision. A year after three Democrats shocked their Senate colleagues by uniting with Republicans to engineer a floor takeover of legislative business, attention remains fixed on the majority coalition. Each majority caucus in the House and Senate held their ground through the 2013 105-day regular legislative session, which predictably ended in a standstill with no budget agreement. The political maneuvering and power plays that plagued the regular legislative session continued through two 30-day special sessions, right up to the point where only two days remained before a state government shutdown loomed and lay-off notices to state workers were set to go into effect. A budget deal was finally struck just short of a shutdown. In 2013 at long last Washington State experienced, along with the nation, a slow recovery from the recession and state revenues were on the rise. Washington's economic hopes now rest on tax increases, economic recovery, especially in aerospace, and the potential of new revenue from the regulated production and sale of recreational marijuana made possible through the passage of I-502 in 2012.
The 2013 Wyoming General Legislative Session was a non-budget year. As a result, few budget bills were passed. A small supplemental budget bill was passed that added an additional $78 million to the $3.2 billion budget approved during the regular 2012 budget session. At this time, Wyoming's economic outlook is strong and state revenue projections are higher than expected.