Members of the Legislature’s Joint Finance-Appropriations Committee were hearing an update on the state budget today, including the good news that Idaho’s structural deficit is shrinking and now looks likely to be virtually gone by the end of fiscal year 2007, if current trends hold. Legislative Budget Director Jeff Youtz ran down the ways Idaho had to scratch and patch to balance its budget in recent years, including a temporary sales tax increase, cutting budgets, deferring maintenance and other needs, and draining virtually every state account that had money left in it. “We raided the water pollution control fund, and every fund that wasn’t adequately hidden from us,” Youtz told the lawmakers, to which JFAC Co-Chair Maxine Bell, R-Jerome, responded, “What one would that be?”
That drew laughter, but things really were that desperate, after state revenues dropped 15 percent in a single year, with 10 percent of that drop from an economic downturn and 5 percent from income tax cuts that lawmakers approved in 2001 just before the downturn. Youtz noted that the state’s budget stabilization fund was among those drained at the time. “It was not quite zero – we had about $34 in it,” he said. Now, with stronger state revenues, the budget stabilization fund is refilling.