Mississippi Faces $634 Million Budget Shortfall For FY 2012
Governor Haley Barbour called for an average 8-percent reduction in state spending, level funding of the public schools funding formula and shared back-office operations in some agencies to save money and improve efficiency in his $5.467 billion Executive Budget Recommendation for FY 2012.
Mississippi faces a structural shortfall of $634 million due to the loss of federal stimulus funds, generally flat state tax collections and an increased demand on the state’s Medicaid program.
That means agencies will have to see budgets reduced, and structural change must be made in state government, Gov. Barbour said.
Some agencies can share administration functions, such as purchasing, while similar services offered across departments can be combined under one roof.
“This Executive Budget Recommendation contains tough decisions that must be made to ensure Mississippi leads as the country slowly emerges from this recession,” Gov. Barbour said. “Real structural change is needed, and Mississippians deserve leaders willing to make bold decisions to protect the financial integrity of our state.”
Gov. Barbour proposed spending about half of the state’s reserves while saving $185 million for future fiscal years, as the economy will recovery slowly and these funds could help avoid deeper cuts.
Proposals for the next fiscal year, which begins July 1, 2011, include:
- Level funding for the Mississippi Adequate Education Program at $2.041 billion, which includes $65.3 million in federal education stimulus funds. The budget does not reduce National Board Certification and Chickasaw Interest.
- Total higher education funding will be cut by less than 2 percent. There is no reduction in funding for Ayers or Student Financial Aid.
- Combining purchasing and other operations at school districts into Regional Education Service Agencies, and combining university back-office operations at four smaller campuses.
- Rolling back Medicaid providers payments to last year’s (FY 2010) levels to trim Medicaid spending. Mississippi’s hospitals and nursing homes are among the highest paid in the nation, and these cuts pale in comparison to the cuts the state has been forced to make to other essential services. Mississippi providers recover 92.45 percent of the costs of medical care for Medicaid patients. Compare that to more wealthy states like Texas, which has a 59.04 percent payments-to-cost ratio, or Florida, which has a 71.51 percent payments-to-cost ratio.
- Merging Mississippi Department of Transportation officers into the Department of Public Safety, freeing up 40 troopers to return to the Highway Patrol.
- Freeing agencies from the Personnel Board for FY 2012 and appropriating lump-sum budgets.
- Reducing Mental Health funding by 7.24 percent and supporting more home- and community-based services.
- Implementing a market-based, consumer-driven health insurance exchange to allow small businesses to provide health insurance to employees.
View the FY 2012 Executive Budget Recommendation here.
View FY 2012 Agency Performance Measures here.
Topics: 2010, America, budget, business, economic development, economic growth, economic recovery, Economy, education, Executive Budget Recommendation, FY 2010 Budget, Governance, government, Governor Haley Barbour, health care, Health Care, improve efficiency, investment, learning, Medicaid, Mississippi, Mississippi Adequate Education Program, moniter, monitor, news, public schools funding formula, reduction, revenue, save money, society, state agecies, state spending, stimulus funds, students, tax collection, U.S., United States
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