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Dear Friends and Neighbors,

Well, here it is!  The long-awaited, much-anticipated first stab at the 2011-13 state operating budget.

Here is a quick snapshot of the reductions:

Policy Reductions

Proposed Substitute House Bill 1087 makes approximately $4.4 billion dollars in reductions. In many cases, the decisions represent a continuation of a funding policy established earlier in either the special session budget bill (HB 3225 from December 2010) or the early action savings bill (ESHB 1086 from February 2011).

Reductions greater than $50 million include:
$1.2 billion for temporarily suspending I-728 (class size initiative) and I-732 (gives teachers pay raises based on the Seattle Consumer Price Index).
$482 million in a general reduction to higher education institutions (in part, offset with assumed tuition increases).
$362 million from making changes to how certain future pension benefits are calculated for Plan 1 retirees.
$216 million from elimination of the K-4 class size enhancement.
$176 million from a 3 percent reduction in state employee salaries.
$141 million from hospital rates and related changes.
$108 million from changes to the Basic Health Plan.
$104 million from biennializing the ESHB 1086 across-the-board reduction for higher education institutions.
$100 million in reduced Disability Lifeline cash grants (continuation of ESHB 1086 reduction). Note that remaining funding for the cash grant program is transformed into a housing program.
$97 million for reduced personal care hours for long term care and developmentally disabled clients.
$89 million from a change in the Federally Qualified and Rural Health Centers payment methodology.
$61 million from changes to the K-12 National Board Bonus program.
$57 million from limiting state contributions to certain higher education pension costs to 6 percent.
$56 million from freezing K-12 steps.
$53 million from a K-12 alternative learning program (ALE) funding adjustment.

And here is what our House Republican budget leader had to say about the budget proposal.  Once we issue our own budget in the House Ways and Means Committee on Wednesday, we'll be able to make a better comparison between the two.  I'll have more on the two different budget proposals as the week progresses.


Joe Schmick

State Representative Joe Schmick, 9th Legislative District
426B Legislative Building | P.O. Box 40600 | Olympia, WA 98504-0600
360-786-7844 | Toll-free: (800) 562-6000