Related articles:

Napolitano should OK bill to freeze spending

Other articles by Howard Fischer:

Matching funds OK for now, judge rules ACC candidate in 2004 pot incident Grant to seek out innocent inmates Law on hours for adult stores hits a detour Clean-elections fund match must go, federal judge told Napolitano questions allocation of funds in some school districts Gov. seeks to bypass budget holdup Developer, his firms to pay $1M for ruining 5 miles of Santa Cruz Ruling will allow 'Choose Life' plate Judge asked to silence AHCCCS chief

Finance and Accounting
Patient Financial Coordinator Construction
ROR Construction
Residential Framing Carpenters Customer Service
LA Z BOY
CUSTOMER SERVICE REPRESENTATIVES Health Care
PATIENT COORDINATOR Health Care
Children's Pulmonary Specialist
MA/Peds Specailty Ofc Trades/Construction
CIMETTA ENGINEERING
WELDERS Sales and Marketing
Everready Glass
Glass Sales

PHOENIX — Ignoring a likely veto, the House and Senate voted Thursday to cut about $260 million in spending and take more than $320 million from other funds to balance the current state budget.

But not really.

The measure advanced by Republican legislative leaders technically does not trim the spending authorization of any state agency.

Instead, it simply directs each agency and the officials in charge of different special funds not to spend beyond those reduced numbers until there is a budget deal.

"It's a good management tool," House Majority Leader Tom Boone said, ensuring the state doesn't go any further into debt. He called it a "spending freeze" rather than an actual budget cut.

But Boone, R-Peoria, acknowledged that if the Republicans and Gov. Janet Napolitano can't reach a deal, these "reserved" funds become actual spending reductions. That includes $25 million in combined cuts for the three state universities and taking more than $30 million from the state Department of Economic Security.

But that still wouldn't bring the state's books into balance. The official estimates put the gap between the tax revenues coming in and the pace that money is being spent at $1.2 billion.

Boone acknowledged that there is not yet any real plan to make up the gap, though GOP leaders have suggested all but draining the $700 million in the state's "rainy-day" fund.

That fact did not escape Napolitano, who all but promised late Thursday to veto the measure when it reaches her desk next week.

"The governor has said that a budget should not be presented to her in a piecemeal fashion," press aide Shilo Mitchell said. Mitchell also said Napolitano wants "a bipartisan process," with the interests of Democratic lawmakers taken into account, and not simply the Republican legislative majority adopting its own plan.

Lawmakers also learned Thursday that the financial picture actually may get bleaker.

The state's Finance Advisory Committee, made up of economists and other financial experts, reported tax collections between now and when the fiscal year ends, June 30, could be even lower than anticipated. The result, according to panel members, could add another $200 million to the deficit.

Thursday's House and Senate votes, with Republicans in favor and Democrats against, reflect the ongoing stalemate in figuring out how to deal with the financial crunch.

At the heart of the problem is that tax collections for the first seven months of the fiscal year, which began on July 1, are $620 million below projections made when lawmakers first adopted the $10.6 billion spending plan.

Napolitano favors eliminating any shortfall through some one-time spending cuts, deferring expenses, taking some money out of the rainy-day fund and borrowing $400 million for school construction rather than paying cash.

House Speaker Jim Weiers, R-Phoenix, said Napolitano and her Democratic allies in the Legislature have not really been interested in any solution that meaningfully cuts state spending. Instead, he said, much of her plan amounts to "bonding, borrowing, gimmicks."

Weiers said actual spending cuts proposed by Napolitano amount to just 1 percent of the budget.

"That is not rolling up your sleeves," he said. "That's not even breaking a perspiration."

Sen. Jorge Garcia, D-Tucson, countered that the Republicans have been unwilling to negotiate in good faith. He said Democrats will not "roll over" and simply accept the kind of cuts the GOP majority wants.

Napolitano has consistently defended her plan for only small spending cuts, predicting that the economic downturn is only temporary. She also has said permanent spending reductions would do serious harm to education and other services in the state.