Wash. Legislature cuts spending

The Legislature took its first step toward dealing with Washington's massive budget deficit on Wednesday, passing bills that would free up more than $700 million to help fill the current fiscal year's budget deficit.

Gov. Chris Gregoire quickly signed the savings bills into law and applauded lawmakers for moving with unusual speed. But that relatively quick work was immediately overshadowed by an upcoming preliminary state revenue forecast, scheduled for Thursday.

With continuing troubles in the economy, including a poor Christmas season for retailers, many officials around Olympia are now expecting that the budget shortfall through 2011 has climbed to around $8 billion.

Majority Democrats acknowledged Wednesday that their "early action" savings were just a first step. Republicans considered it more of a half step, and accused Democrats of not taking the state's mammoth deficit seriously.

In odd-numbered years, the Legislature has two budgeting tasks: Writing a tuneup budget that covers the rest of the current fiscal year, and tackling the next two-year state budget.

The work usually doesn't start until early spring, after lawmakers get a look at forecasts of state income and spending trends. But this year's dire budget hole has pushed that schedule up a bit.

Still, the Legislature's early spending cuts don't address the other side of the ledger: additional spending needed to keep government operating for the rest of this fiscal year, which lasts through June. That work will come later, along with much more severe budget cuts in the 2009-2011 budget.

"Every one of these cuts is painful, and the cuts we'll make later will be more painful," said House Ways and Means Chairwoman Kelli Linville, D-Bellingham. "People will lose their jobs, and programs that took years to pass and get up and running will be cut, or eliminated, or put on hold."

The heart of the Legislature's early savings plan is a bill that gained final passage in the House on Wednesday, by a vote of 80-14.

The bill cuts state spending by about $290 million. But there's more reliance on short-term solutions that don't solve the underlying budget problems: about $91 million in transfers from other accounts, and about $340 million in federal assistance, some of it assumed to be coming from the stimulus package.

"My fear is that we're waiting around, hoping that the federal government bails the state government out," said Rep. Mike Armstrong, R-Wenatchee. "And I'm here to tell you, this is our problem."

As she signed the bills, Gregoire reiterated that the stimulus package will help the budget problem, but not fix it entirely.

"Although we appreciate the money coming from the federal government, let me be clear about one point - this money will not solve our budget shortfall," she said.

The Senate unanimously passed a second bill that would generate about $6.7 million more in state savings by extending some administrative cost-cutting measures first implemented last year by Gregoire.

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On the Net:

Legislature: http://www.leg.wa.gov

Governor: http://www.governor.wa.gov