Arizona Capitol Times: State spending tracks higher than last year

By Luige del Puerto

So far, Arizona has spent more money this fiscal year than it did during the same period last year.

Between July 1 and Aug. 17, the state spent $164 million more than it did during the same period in 2008, according to figures provided by the state Treasure’s Office.

Adjusted for rollover difference, the state has cumulatively spent $2.1 billion as of Aug. 17, compared to $1.98 billion at the same date last year.

Sen. Thayer Verschoor, a Republican from Gilbert, was perplexed by the numbers.

"I don’t understand that," he said. "At the same time, every day we are running negative balances."

As of Aug. 19, Arizona was $386 million in the red, according to the state Treasurer’s Office.

Treasurer Dean Martin said there are a few variables, including the fact that the days of the week during the period this year don’t necessarily line up with the days of the week during the same period last year. That comes into play when considering factors such as the payroll rotation for state employees.

Also, the spending figures fluctuate daily, he said.

But, to put it in better perspective, Martin said the state’s cash-flow position is much different this year than it was in fiscal 2008.

As of Aug. 19, the state was $386 million in the red. Compared that to the same period last year when the state was $650 million in the black.

"It is not just that we are spending at the same rate as last year, we are spending at the same rate with no money," he said, adding what his office has been saying is the general fund is broke.

"We can only keep the lights on for a limited amount of time before they have to start deciding who gets paid and who doesn’t get paid," Martin said.

Martin said his office doesn’t receive much of the data on specific spending by agencies. But he speculated that agencies have been authorized to spend more so far this year because Brewer line-item vetoed budget reductions last July.

Without a balanced budget in place, the state will run out of its ability to borrow money as early as middle of October. He said banks won’t loan the state money without a balanced budget in place because there is no guaranteed revenue source by which to pay back the loans.

Paul Senseman, the governor’s spokesperson, blamed the increase on mandatory growth spending. He cited as an example the growth-driven spending increases in the Arizona Health Care Cost Containment System (AHCCCS).

"AHCCCS has seen at least $300 million worth of mandatory increased spending, and that’s just occurred over the last several months," Senseman said. "If that should continue and unemployment continues to grow in the state, you would expect that AHCCCS costs would continue to increase. The Legislature and the governor can’t restrict those funds."

He said Gov. Jan Brewer made the largest spending cuts in Arizona history in her first few days in office. He said the state’s workforce was reduced by about 1,200, and thousands more were furloughed for various lengths of time.

"(But) even with the aggregate cuts that have been implemented by the governor and the Legislature, which were historic in nature, along with the governor’s relentless pursuit in her autonomous agencies of spending reduction and scrutinization of expenditures, it still won’t keep pace with the mandatory spending that’s locked in," Senseman said.

- Reporter Jeremy Duda contributed to this article.