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Trying to ‘get through it,’ Gregoire signs unpopular budget

Today’s revenue forecast may lessen cushion

OLYMPIA – Washington state has a plan to spend some $32 billion on programs, services and salaries over the next two years, leaving a cushion of about $725 million in the bank. The plan is good until sometime this morning, anyway, when that cushion is expected to shrink.

It’s a plan that no one much likes, not poor people who will be bumped off the state’s Basic Health plan or Temporary Assistance to Needy Families, or college students who will face higher tuition or state employees who will take a 3 percent pay cut, or communities that will have more recently released low-risk felons living there without supervision.

Not Gov. Chris Gregoire, who signed the 2011-’13 general operating budget Wednesday afternoon then called it bittersweet because it takes the state forward in some areas but dismantles some of the programs she spent a career supporting.

“It sets more changes in motion than anyone thought possible,” she said. “We did not resort to gimmicks, to short-term fixes or to new taxes.”

It is the last biennial budget Gregoire, who announced this week she will not seek re-election, will sign. She proposed an all-cuts budget in December that she said she hated. This plan that took the Legislature a 30-day special session to pass preserves pared-down versions of some programs she would have ended. But she said she doesn’t like it either.

“Sometimes your agenda gets set aside, and you do everything you can to get through it,” she said. Higher education cuts are “the hardest thing for me to swallow right now.”

In cutting some $532 million from higher education programs over the next two years, the Legislature gave the colleges and universities more authority to raise tuition, and most have already signaled they will take it. The University of Washington indicated recently it would call for 20 percent increases for in-state tuition.

If everything in the general operating budget goes as planned, the state would have about $725 million left on July 1, 2013, when it starts the next biennium. That number may only be good until about 10 a.m. today, however, when the latest state revenue forecast is released. It is expected to be several hundred million dollars below the March projection used to craft the budget.

“I know we’re going to get a bad forecast,” Gregoire said. It’s one reason she and legislative leaders pushed for as large of an ending-fund balance as possible. “I’m confident we’ll get through the June forecast. I don’t know what will happen in the September forecast.”

Along with other bills signed Wednesday, the state will consolidate some agencies, revise the workers’ compensation system, lower its debt limit over the next 15 years, and end the practice of allowing some employees to retire, take a pension and then be hired back to their old jobs.

It will start the construction of a new medical school in Spokane, which is among some $2.6 billion in the capital project budget also signed Wednesday.

It will ask for bids from any company that wants to lease and modernize its wholesale liquor distribution system. Gregoire refused to veto the emergency clause in that bill, even though voters might be asked to turn all liquor sales in Washington over to private businesses through a ballot initiative in November. That Costco-backed proposal is currently gathering signatures that must be submitted by early July.

Even by starting immediately on the bidding process, the state isn’t expected to have figures for at least four months. The process usually takes about six months, she said.

While she believes it’s unlikely the bidding process will be complete before the election, Gregoire said she won’t tell the Liquor Control Board to hold back until after the vote: “I’m not going to game the system. I’m not going to sit here and say it can’t be done.”