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STATE GOVERNMENT UPDATE #149th LegislatureJanuary 16, 2009The Appropriations Chairmen have released their "options"for the FY 2009 and FY 2010 projected shortfalls. The consequences of all of their proposals for the Universities is a reduction of $243 M for FY '09and$388 M for FY '10 - the latter takes into account much of the '09 cuts.For the UA alone the numbers are $104 M for '09 and 154 M for '10.The damage is accomplished through a mixture of operating budget cuts and sweeps of some of our fund balances. The details are notyetavailable so that exactly what fund balances are hit is uncertain.To call these proposals devastating would be anunderstatement. They were created within the guidelines of no borrowing bythe State, no creative accounting, and no tax increases. They alsoassume asmall federal bailout.We should keep in mind that this is only the openingshot.We have seen chairmen's proposals before that were significantlymodifiedfor the better before the Governor signed the final product, and that product will have to garner 16 and 31 votes. I detected very littleenthusiasm among Legislators for what was presented Thursday.
 
While raising taxes is very difficult it is possible,andthere are ways of borrowing that are constitutional and would allow ustokeep going with much smaller cuts. Also, federal relief may provide muchmore help than is contemplated.Governor Napolitano has released her budget proposaltodayand it cuts the Universities by $50 M in FY's '09 and '10. She achievesthese much smaller reductions by securitizing the lottery and thetobaccosettlement, delaying general fund payments to the Universities (the"rollover" technique used with K-12) among other devices. While she willsoon leave office, Governor Napolitano is leaving behind some ideas thatwould cause much less harm than other alternatives.Your lobbying team and external support networks are ingear and working for a substantially better outcome than the Chairmen's. Thiswill be tough, but the Chairmen's options can be defeated. But inlanguagereminiscent of the late Saddam Hussein, this will be the mother of allsessions.Greg Fahey*************************************************************STATE GOVERNMENT UPDATE #249th LegislatureJanuary 23, 2009BUDGET
 
The majority leadership of the House and Senate hastried tomove quickly on passing an '09 budget fix incorporating many of theAppropriations Chairmen's plans. They have not been able to gather thevotesto do so as members of both parties recoil from the consequences of sucha package - and as the public outcry builds.Another factor that has some legislators disturbed isthedisproportionate results of the proposals on the UA. The total of theChairmen's options would have the following reduction consequences for thethree universities' FY '09 and '10 base budgets:FY '09FY '10UA 25.6%38.8%ASU 17.4%27.5% NAU 21.0%32.6%There is no good explanation for the infliction of  budgetreductions in such an imbalanced manner. We understand that we must becut, but are arguing for a considerably lesser amount as well as for thetraditional approach of allowing the Regents to apportion thereductions.A significant occurrence this week was the Speaker of theHouse convening a meeting with the University Presidents and thePresidentof the Board of Regents. Talks are to continue with him and other members of his caucus next week in an effort to determine a budget reduction amountfor the Universities that can be sustained without crippling results. If that
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