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Arizona struggles with budget crisis

The Legislature faces a nearly $2-billion deficit, which rises to $3 billion next year. It's one of 35 states with ongoing budget problems, and experts say its plight is second only to California's.

November 27, 2009|By Nicholas Riccardi

Reporting from Phoenix — When the Arizona State Senate broke into disarray last week during its fourth special session in four months to deal with this state's seemingly perpetual budget crisis, Senate President Robert "Bob" Burns told his colleagues: "It amazes me we're having this much trouble. This is the easy part."

It took until Monday for the GOP-controlled Legislature to pass $300 million in spending cuts, ones they had already approved in June but which were vetoed by the state's Republican governor, Jan Brewer.

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Even so, Republican lawmakers still argued among themselves over how to close what is a relatively small part of the state's deficit. Looming on the horizon is a nearly $2-billion gap that remains in this year's $10-billion budget. Next year the deficit rises to $3 billion.

In percentage terms, Arizona's deficit is nearly as big as California's, and although the state may lack a movie-star governor, there has been no lack of drama in Phoenix for several months.

The state has put its Capitol buildings on the block to raise money. It is trying to privatize its prisons, and some legislators are talking about a four-day school week. This month, the Pew Center on the States ranked Arizona as having the second-worst budget crisis in the nation, just behind California.

"There are actions they can take, but none of them are easy or pleasant," said Dana Naimark, president of the Children's Action Alliance, a local group fighting budget cuts.

Noting that legislators have already cut more than $500 million since February, she worried that the state is already reeling from reduced services. "It's very disturbing, going backwards on so many fronts," she said.

Most states need to have budgets in place each July 1, when the fiscal year begins. But with the economy in the tank, many states are watching new deficits pop up as tax receipts plunge and more and more people demand social services to alleviate their own financial woes.

Arizona and California -- which still faces a deficit of $20 billion -- are only two of the most extreme examples. Thirty-five states are still scrambling to balance their books for the current fiscal year.

"We're seeing this in several states across the country because the revenues continue to drop faster than projected," said Sue Urahn, managing director of the Pew center.

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