Tuesday, May 18, 2010
By ROBERT T. GARRETT
The Dallas Morning News
Texas leaders order spending cuts of $1.2 billion
AUSTIN — Texas leaders, anxious about a widening budget gap, ordered state agencies today to cut spending by $1.2 billion.
While public schools, prisons, home care for the frail and institutions for vulnerable Texans largely escaped reductions, leaders approved scores of cuts, including some that could threaten recent progress in children’s Medicaid, adult education and making two-year colleges more convenient.
Other cuts will delay regulatory initiatives, from ensuring food is safe to policing unscrupulous funeral home operators, though Lt. Gov. David Dewhurst salvaged his pet project, testing high school athletes for steroids.
Leaders said they had to find savings now so it will be easier for lawmakers in next year’s session to bridge a looming deficit. The shortfall has been estimated as likely to be between $11 billion and $18 billion in the next two year budget cycle.
“These reductions reflect our state’s ongoing commitment to keeping taxes low by limiting government spending, a key aspect of the continued strength of our state’s economy,” said Gov. Rick Perry.
Dewhurst said the cuts “will protect taxpayers’ hard-earned money while maintaining essential services.”
Perry, Dewhurst and House Speaker Joe Straus, R-San Antonio, hope to roll the savings forward into the budget for 2012-2013, which lawmakers will write next session. Agencies will begin submitting two-year funding requests this summer and fall.
“Each agency’s savings plan will be further reviewed,” the three leaders said in a release, “and each may be directed to achieve additional savings or granted additional exemptions.”
Under one of the biggest cuts, which saves $64 million, nursing homes, hospitals, doctors and pharmacists will be paid 1 percent less by the state-federal Medicaid program when they care for low-income pregnant women, disabled adults and the elderly. Providers, including dentists, also will receive 1 percent less for treating children on Medicaid and the Children’s Health Insurance Program. The cuts take effect Sept. 1.
Originally, the cut for acute care of adults was to be 2 percent.
Health and Human Services Commissioner Tom Suehs avoided cuts to so-called Medicaid waiver programs, which help the frail elderly and disabled stay in their homes. He also spared from reductions foster care, adoption subsidies and the eligibility determination system, which is just digging out of a huge backlog of food stamp requests.
Still, the cuts to providers’ reimbursements could set back recent attempts to coax more doctors to participate in children’s Medicaid. The state, after settling a long-running class action lawsuit in 2007, ramped up fees for pediatric services.
Also cut were plans to build several new community college campuses and 1,000 slots for adult education at two-year colleges. And at several community college systems, including Collin County’s, there will be fewer remedial classes offered.
However, college financial aid programs were almost entirely spared. A proposed $50 million cut was entirely eliminated. A Legislative Budget Board list of exemptions suggested a partial cut would be carried out, affecting students who graduate in the top 10 percent of their high school class in 2012-2013.
But higher education experts said that Sen. Steve Ogden, a Bryan Republican who is the Senate’s chief budget writer, authored the top 10 percent scholarships. He is likely next session to make sure the trim – if it was not a typographical error by the budget board – won’t occur, they said.
As expected, the leaders shielded from cuts virtually all prison operations and a host of inmate treatment programs that have been hailed as successful in ending Texas’ prison-building spree.
They cancelled a plan to lay off 3,100 employees in the prison and parole systems and to cut drug and alcohol treatment programs. They accepted prison officials’ offer to save $50 million with a hiring freeze and by delaying equipment purchases and the opening a medical facility in Marlin.
But after the prison system objected to another $244 million in possible cuts, state leaders ordered less than $5 million of them to be carried out. Documents released with the announcement did not specify what they were.
Leaders also rescinded a $27 million cut proposed for Terrell State Hospital and three other state-run psychiatric hospitals. County officials and mental health advocates warned that a plan to close 50 beds at each would have clogged jails and emergency rooms with desperately mentally ill Texans.
Also unaffected by the cuts is the state’s recent push to improve so-called state supported living centers for the mentally disabled, which were rocked by disclosures of a “fight club” involving residents in Corpus Christi in 2008.
The cuts for public schools that leaders embraced – some $126 million -- were in many cases unused grant money, or involved items for which the Texas Education Agency said it could use other funds.
However, while TEA proposed to save $1 million next school year by eliminating the steroid tests of athletes, $750,000 of the money was restored by the leaders. Dewhurst has been the measure's champion.
Hiring and travel freezes at many agencies will curtail plans to improve state regulation.
The state health department will postpone hiring new food safety inspectors, a response to last year’s outbreak of salmonella traced to a Panhandle peanut plant.
And the state Funeral Service Commission, to save $15,000 in travel expense, will perform 600 fewer inspections of funeral homes.
Although the Republican state leaders have described the reductions as 5 percent cuts, that’s something of a misnomer.
When Perry, Dewhurst and Straus asked for possible cuts in January, they placed off the table just over half of the current budget’s $87 billion of state-revenue spending. The main school funding program, Medicaid eligibility and benefits, and state contributions to public employee pensions were off limits.
Leaders asked for ideas on how to cut remaining programs by 5 percent. In the end, though, they shied away from about 30 percent of the $1.7 billion of trims that were offered.
“I am confident we are making and will continue to make thoughtful, responsible decisions,” Straus said.