LITTLE ROCK — Gov. Mike Beebe said today he does not anticipate any layoffs as a result of the latest round of state budget cuts.
Beebe announced today he would cut another $106 million from this year’s state budget because of continued shortfalls in state revenue.
The budget cuts, 2.4 percent across the board, are the second the governor has made this fiscal year because revenues have not kept pace with projections. In late October, he cut $100 million, a 2.2 percent reduction of the overall budget.
“Arkansas will always live within its means,” the governor told reporters Monday. “When people are hurting and when people reduce what they’re spending and state revenues go down, then the state of Arkansas will reduce its spending as well, and this is what we are doing.”
The announcement came on the eve of legislative budget hearings, which begin Tuesday in advance of the Legislature’s first-ever state fiscal session. The session convenes Feb. 8.
Rep. Bruce Maloch, D-Magnolia, co-chairman of the legislative Joint Budget Committee, said the additional budget cuts were not unexpected. But he added, “We’re certainly hopeful this does it for this fiscal year.”
Beebe said he is optimistic the economy will improve and that his balanced budget for fiscal year 2011, to be released Tuesday during the first day of budget hearings, will return to current budget levels on July 1.
today’s revised revenue forecast means all state departments and agencies will have to tighten their belts, except for public education, which is required by the state Supreme Court to provide an adequate education to Arkansas students, the governor said.
Beebe said surplus funds will be used to lessen the blow on the state Department of Human Services, the Department of Correction and the Department of Community Correction.
He said the state has $40 million in surplus funds that the Legislature set aside last year to use to plug holds in the budget, and some of that will be used for Medicaid programs at DHS.
About $8 million will go to make sure state prisons remain operational and inmates don’t have to be released early, like some other states have been forced to do, he said.
“They won’t open a new prison, but they probably will be able to function at their current level,” Beebe said.
Richard Weiss, director of the state Department of Finance and Administration, said Monday the amount human services, prisons and the Department of Community Correction in surplus funds would be determined later this month after they turn in their budgets with recommended 2.4 percent cuts.
“Anytime we go out with budget cuts like this … we give the agencies about two weeks to come up with where they want to take cuts out and how they want to deal with it,” Weiss said.
DF&A reported last week that state revenues fell $20.9 million short of projections in December and were $80 million for the first six months of the fiscal year from the same period last year.
