Locke budget busts caps

Gov. Gary Locke, facing a divided Legislature and limited dollars, proposed a $22.7 billion budget on Tuesday that lifts a 7-year-old spending cap to meet voters' recent demands for more school money.

The governor's two-year budget would plug nearly $700 million into schools to shrink class sizes, extend school days and boost teacher pay. It would create room for 10,000 to 11,000 students, including part-timers, at the state's colleges and universities. It would reduce child-protection caseloads, pour $13 million into local economic development and create tax breaks for power plants and conservation.

Locke also wants to spend $9.6 billion over the next six years on the state's overcrowded and aging transportation network, including four new ferries and construction of a north Spokane freeway.

How to pay for it? A state committee has recommended a host of things, including a higher gas tax. But Locke says he'll let the Legislature decide how to raise the money.

Locke also wants state lawmakers to give him direct control over the state Department of Transportation. He promises reforms and efficiencies, including money to fix highway choke points and improve the flow of freight.

On the other side of the balance sheet, Locke's budget also includes $267 million in cuts, with about $163 million of that coming out of the state Department of Social and Health Services. It trims adult health and dental care, funding for mental hospitals, medical care for the poor, teen pregnancy programs and nursing home reimbursements.

"Outside of education, the largest cost center is DSHS," Locke said in a phone interview Tuesday afternoon. "I believe that we have to really get back to the core services of DSHS programs."

He pointed out that the budget does include some $84 million more to improve social services for abused children and the elderly and to improve sex offender supervision.

Nonetheless, the $167 million in DSHS cuts worry some, including legislators in Locke's party. State Sen. Lisa Brown, a Spokane Democrat, said her phone started ringing at 7 a.m. with Democratic callers.

"His budget demonstrates how tough some of these decisions are," she said.

Republicans seem more worried about how the proposed budget would draw at least $400 million from the state's $1 billion in reserves.

"It's like if you're a household making $500 a week, spending $650 a week, and you've got $1,000 in savings," said Republican House Speaker Clyde Ballard, of East Wenatchee. "It doesn't take very long before there's a problem."

With dot-coms faltering, fuel and power costs rising, and Spokane and Eastern Washington facing tough financial times, he said, this isn't the time to be tapping the savings account.

"It's the old spend-everything-you've-got, damn the torpedoes and full speed ahead," said Jim West, a longtime House Republican from Spokane. "He (Locke) hasn't made the tough management decisions."

Locke conceded that not everyone will be happy with the budget, but he called it balanced and responsible. Following such a course, he said, the state's needs can be met for the next six years without a tax increase.

For all the excitement - phones and fax machines were ringing all over the state Tuesday as agencies struggled to figure out what the proposal meant - the budget is merely a blueprint.

It will be hashed out over the next several months, as lawmakers in the House and Senate try to find common ground. That's likely to be difficult, with the House facing its third consecutive year with a 49-49 split between Republicans and Democrats. The Senate has a small Democratic majority.

As chairwoman of the Senate's Ways and Means Committee, Brown faces the task of hashing out the Senate's version of the budget. She predicted that the Senate's final budget will be similar to Locke's in total spending, but that some spending priorities will change.

"It's an important starting point," she said. "It's going to be tough. I'm going to be looking for ideas from everyone to get through this."

Part of the problem is that Locke and lawmakers are torn between conflicting marching orders from voters. In 1993, Washington citizens passed Initiative 601, which limited state spending. But this fall, they passed initiatives 728 and 732, both of which demanded spending roughly $800 million more on schools and teachers.

To get around that problem, Locke's budget assumes that voters meant to add the additional spending to the 7-year-old cap.

Republicans, Locke pointed out Tuesday, have previously suspended Initiative 601 to fund road work. But they've been loath to make wholesale changes in the initiative.

Locke's budget this year "just guts 601," said Ballard. "It just blows right by it."

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