Announcement of a balanced budget for 2004

Tuesday, June 17, 2003

Governor’s Office

Phoenix, Arizona

One hundred fifty-six days after this session began, I am pleased to sign Arizona’s fiscal year 2004 budget into law. When I took office in January, people wondered whether things really had changed.

• Would we continue to under-fund education to balance the budget?

• Would we gut vital services to children and families?

After all, we faced a $1 billion budget deficit.

Today, I am pleased to say that we have found a safe way through this crisis. I am about to sign into law a balanced budget for 2004 that fully funds education, protects vital services for families and children, and that lays the groundwork for a prosperous future. As you will see, however, while the budget the Legislature passed was much better than the budget they originally proposed, I will today exercise my line-item veto authority to improve upon what they sent me, especially where education and children are concerned.

It has been a long spring, but we did it. And, I am pleased to be joined by community leaders to celebrate this landmark event.

K-12 Education

First and foremost, I am very pleased to say that we have fully funded K-12 education. There was a time when our schools were facing severe cuts to their operations, but this budget contains full funding for enrollment growth and inflation, as well as:

• Early-childhood development block grant, with $19.4 million to help fund all-day kindergarten in hundreds of schools.

• Millions of dollars for adult education, family literacy, and dropout prevention initiatives, which combine affect tens of thousands of at-risk students statewide.

• And I have restored full funding to school districts that have experienced a rapid decline in enrollment, to stave off potential property tax increases.

Come August, Arizona’s teachers and students will return to schools in the fall that have received the support they need to succeed.

Economic Development

This is also true of our economic development drivers:

• Our community colleges and universities have avoided across-the-board administrative cuts. And, as the years progress, we’ll look for other ways to improve our universities and community colleges.
• The Legislature has agreed with my proposed budget for the Department of Commerce and the Office of Tourism, so they can continue to carry out the business of expanding economic opportunities for Arizona.

Strengthening families

Thousands of Arizona families will grow stronger under this budget. We have restored funding for such vital services as:

• KidsCare, which provides health coverage for more than 60,000 children with no other access to health insurance

• KidsCare Parents, which provides health coverage to 21,000 parents who are employed but who cannot afford basic health insurance

• assistance for 1,600 developmentally-disabled children

• Healthy Families, which is one of Arizona’s most successful tools to prevent child abuse and neglect

• Family Builders, which provides counseling and other services to families at risk for child abuse

• the Homeless Youth Intervention Program, which provides services to runaway children as well as those children at risk of running away from home.

• and funding for domestic violence shelters, which had been slated for a 22 percent reduction in funds.

This budget is family-friendly, and it ensures that the state of Arizona will continue to do its job to prevent abuse and neglect, especially of its youngest citizens.

Health and Welfare

We have restored crucial services for many at-risk populations who have the critical need for state assistance, but not necessarily anyone to speak up for them at the state Capitol.

I am very pleased that we are preserving funding for:

• Substance abuse services, which was about to be eliminated for more than 10,000 people. Those cuts would have cost us much more by increasing crime rates, homelessness, welfare enrollment and unemployment.

• AIDS Drug Assistance Program, which provides life-saving medications for more than 1,000 economically disadvantaged people with AIDS.

• Psychotropic medications, which will allow for more than 5,400 individuals to lead stable lives.

• and acute breast and cervical cancer screening and care to low-income women

All of these services will ensure three very important things:

• We have given meaning to the principle that Arizona will begin to invest in education for our children – our human capital.

• We will not yank health and human services from Arizonans who need it the most.

• And our economic development efforts will continue on, fully functioning, working to help pull Arizona out of the current economic slump.

In this budget, Arizona has managed to avoid the fate that is plaguing so many states. Some of the measures other states are considering are just unthinkable here:

• In Massachusetts, tuberculosis tests may soon cost $50 apiece.

• In Georgia, funding for K-12 education has been cut by more than $150 million.
• In Oregon, students were sent home from school one day a week to cut costs earlier this year.

• And in Kentucky, some state prisoners were released early.

Thankfully, Arizona has avoided having to resort to such desperate tactics.

That said, the bills I have been sent were not perfect. I appreciate the effort put into them by members of the Legislature, and I thank them for their hard work. However, I am exercising my power to line-item veto several provisions in this budget.

My vetoes accomplish four objectives:

• First, they restore crucial funding to various programs and state agencies. Through these line-item vetoes, I have freed up monies that can be redirected to vita programs like Child Protective Services.

• Second, they ensure that voter-designated funds are spent the way voters have ordered us to spend them, particularly the Heritage Fund.
  
  On several occasions, Legislators attempted to divert voter-designated funds away from the uses that were established by votes of the people.
  
  Every elected official is a steward of the public will and trust. I would have preferred that the Legislature respect the will of the people in this budget by leaving voter-designated funds alone.
  
  However, if the only thing standing between the will of the people and an overreach of the Legislature is a line item veto, then it is my obligation to exercise that power on the people’s behalf.

• The third objective of these vetoes is to reduce our dependence on borrowing. Ultimately, this budget will require us to borrow less with my line-items vetoes than it would if it were signed it into law untouched.

• And fourth, the vetoes provide us with a healthier ending balance. My vetoes will achieve a $25 million ending balance, as compared to the $16 million ending balance proposed by the Legislature.

Finally, the budget presented to me is not what we would wish it to be – a finished product. In particular, one concern remains.

If we do not find supplemental funding for the Department of Corrections, our state prisons will be unable to accept any more prisoners.

Clearly, we need to resolve this situation soon, and I expect to work with Speaker Flake and President Bennett to craft a mutually-acceptable solution.

For today, I am signing this budget to keep state government moving forward without interruption. The 2004 budget crisis is now behind us.