Republican Gov. Jan Brewer

Brewer Orders Agencies to take Draconian Measures to Cut Costs

PHOENIX (Wire Services) December 23, 2009 ― Gov. Jan Brewer on Monday ordered state agency directors to rein in spending, although many of her proposed cost-saving practices are already in place.

In an unprecedented open-door Cabinet meeting, Brewer called for some new savings measures, notably establishing a waiting list for state health insurance for children from low-income families.

In other cases, her requests turned out to be tweaks to existing policies or simply pressure to make use of plans already in place.

Still, significant budget-cut plans are under way or being considered: 5 percent pay cuts for state workers; releasing more non-violent illegal immigrants from prison and turning them over to federal authorities - which prisons already do in some cases; assessing surcharges for mental-health care in the state's public-health system.

"We face a state fiscal crisis of unparalleled dimension, one that is going to sweep over every single person in this room, as well as every business, every family, every Arizonan," Brewer said.

Although expressing optimism for the state's long-term future, Brewer said the deficits plaguing the current year budget, as well as fiscal 2011, require tough choices.

She acknowledged that lawmakers will tackle the "biggest issues" but issued immediate orders to cut spending. Her remarks came two days after the Legislature approved $194 million in budget cuts in a bill she said she will sign.

Left unsaid Monday was Brewer's long-standing call to boost state revenue through a temporary sales-tax increase.

Chief of staff Eileen Kleinsaid the governor will ask lawmakers to enact the increase themselves rather than send it to the ballot. That would bring new money to the state quicker than waiting for an election. But it requires a two-thirds vote in the Legislature - a difficult proposition because lawmakers all year have not been able to muster the simple majority vote needed to send the tax increase to voters.

Brewer's directives, in many cases, tweak existing policies.

For example, she told directors of the state's welfare agencies to establish income-eligibility guidelines and sliding-fee schedules for benefits programs. But tests are commonplace already.

"The vast majority of everything we do is means-tested through AHCCCS (the state's Medicaid program)," said Will Humble, interim director of the Arizona Department of Health Services.

An exception is the 14,500 seriously mentally ill. Agency officials are mulling whether to charge a monthly premium of $25 to $50 to help defray the costs of their state-provided services.

Brewer told agency directors to start work on possible 5 percent pay cuts to state employees, something that the Legislature authorized last week. Brewer's office emphasized that pay cuts would be at the discretion of state agency directors. The state school system, community colleges and universities would be exempt because they are receiving federal stimulus dollars, which come with a requirement that spending not be cut beyond 2006 levels.

In other cases, Brewer's moves will break new ground. For example, she has ordered creation of a waiting list for KidsCare, the state's health-insurance program for children from low-income families. Currently, any child who meets the income guidelines qualifies.

A waiting list could be in place as early as today, said Monica Coury, spokesman for the Arizona Health Care Cost Containment System, which administers KidsCare.

There are 46,886 children in the program, but any vacancies will not be filled, Coury said.

Brewer also ordered Corrections Director Charles Ryan to return non-violent illegal immigrants in the state's prison system to federal custody.

Ryan acknowledged the state already has a policy to release these inmates for deportation when they have served half of their sentence. But, he added, "we're going to take a much more thorough review" of the process.

Arizona prisons house 6,200 criminal illegal immigrants, Ryan said.

Brewer also called for a limit on the state's child-care-assistance program. But that program has been capped since February because of earlier budget cuts. There are 10,349 children on a waiting list now, according to the Department of Economic Security. She did not have estimates of how much money the directives would save the state.

Arizona's budget deficit is so dire that if lawmakers opt to cut their way out of next year's projected $3.4 billion shortfall, they will have to shut down all programs not mandated by the federal government, she said.

While education and certain welfare services would be protected, the rest of state government - prisons, parks, Highway Patrol - could be axed, according to the governor's budget office.