Well, someone had to, so here it is – Mississippi’s State Budget 101

On this wet, cold and getting colder January day, the Mississippi State Supreme Court turned on the heat — and the otherwise dignified Chief Justice William Waller, Jr. gave the State’s hitch-up-your-britches Governor a wedgie when he officially broke the news:

The Mississippi Supreme Court, in a unanimous ruling, said Friday that Gov. Haley Barbour does not have the constitutional authority to cut the budget of the state’s court system.

Governors have been legislatively enabled to cut the budget to ensure Constitutional compliance; however, the State law says the governor can’t cut any program’s budget by more than five percent until he has cut every program’s budget by that amount.

The Supreme Court’s En Banc Administrative Order says that compliance with the Constitution also includes exempting the courts from the Governor’s cuts citing provisions for separation of power.

The State Fiscal Officer’s authority to make budget cuts pursuant to Section 27-104-13, or otherwise, is limited to “agencies” and “the Mississippi Department of Transportation,” and does not extend to the judiciary, which is constitutionally-established as a separate branch of government, rather than an “agency.”

The Order points to the distinction between a “separate branch of government” and an “agency”; however, in terms of the State budget, the distinction is between “units of government” and “arms of government”, more commonly known here as “general fund agencies” and “special fund agencies”.

Special fund agencies represent two distinctly different arms.  One is the arm of the federal government and the other is actually called just that – other special funds and boy are they ever special!

The Mississippi blogs beat the socks off MSM getting this story up (credits below).  The Sun Herald online, however, deserves a shout-out credit for running the AP story Miss. Supreme Court: Gov can’t cut judicial budget instead of the news briefs I found elsewhere that typically ended with read more in Saturday’s paper.

The ruling came the same day Barbour announced that January revenues fell by 12.2 percent, or $43.4 million. It is the 17th consecutive month revenue came in below estimates.

“I soon will be forced to look at whether additional cuts will be necessary in the current fiscal year beyond the $437 million in cuts already made,” Barber in a statement. “The law requires a balanced budget and I will uphold the law.”

Most agencies are losing 8.2 percent of their funding.

How did we reach this point? Easily is the unfortunate answer. Po’ folks that we are and have been for generations, we’ve not been too proud to use the equivalent of Walmart’s lay-away plan to meet the State’s Constitutional requirement for a balanced budget. Nope, no shame at all in putting our future on the line and rolling the dice – particularly after we hit the jackpot following the 1990 legalization of gaming.

We’ve been poor, according to former Governor Mabus, because we don’t have any money.  Consequently, we started spending the revenue from gaming likely the neveau riche we thought we were.

The experience of a friend of mine provides the best description possible of the way we approach planning in the State.  She was conducting a survey that collected data from low-income workers in food processing plant and one of the questions was Do you plan to have a child in the next five years.  The question always caused participants to giggle, some even laughed aloud. She was able to ignore the response and continue until one group of women read it and, as we say, just fell out.  What made the question so funny, one finally admitted, is they’d never planned any of their children, they just had ’em.

In other words, we just spent with no consensus plan in mind and, as a result, we just f*$%@& our money away.  We spent millions renovating a stadium we now need to tear down; and many more filling college campuses with new buildings at a time when we should have been building infrastructure for online learning –  and these are but two of our short-sighted spending decisions that total a greater number than one can count.

By the late 1990’s, we not only had more annual revenue in the State General Fund; but, like other states, we also had more control of federal funds coming into the State.  On top of all of those millions upon millions of dollars, we also had a windfall from the tobacco settlement.

Despite all of that, we entered the new millennium robbing Peter to pay Paul and, now, Peter is out of money, Paul is dead broke, and the Supreme Court has called a showdown.  Hopefully, it will force the Legislature to make long needed changes:

  • Some state agencies are totally State funded.  Small cuts run deep in these agencies.  Others may have little more than the State funds needed to drawn down associated federal funds.  in some cases every State dollar cut will result in the loss of one-to-three federal dollars.  Small cuts run even deeper in these agencies.
  • A third group of agencies, however, expects the Legislature to fund their basic needs so they can spend the locally appropriated funds as they wish.  The oldest trick in the book is for a state agency to secure federal or private funding and use it to establish programs and/or construct buildings the State then has to pick up.  Most, but not all, of the agencies in this third group represent all levels of public education.
  • Last in this list of needed change but, by no means least, is the common practice of agencies keeping funds when the associated program funded by the legislature ends.  This all goes largely without notice as positions are reclassified and take the money with them.

The other special fund agencies, however, are a different breed of cat.  One that pays its own way. 

Many of these “arms of government” exist for the public benefit as their purpose is ensuring qualified individuals provide provide professional services.  Special fund agencies often conduct the examination required for a license to practice.  The associated fees required for an examination or license are deposited into the State Special Fund and returned to the organization through the appropriations process.

When all is said and done, the bottom line is the only place in the state budget that can offset a general revenue shortfall is the general fund with the expenses of the judicial branch of government excluded just as those for the legislative branch are off the table.

And that is the wedgie Chief Justice Waller put on the Governor.  It is also our collective problem to resolve.

Credit and a thank you to these Mississippi Blogs:

Ipse Blogit broke the story early afternoon with REPORT – Justice Randolph tells CLE participants that MSSC says Executive Branch has no authority to cut Judiciary budget *UPDATE x2*. Separation of Powers: The Mississippi Supreme Court throws down the Gauntlet followed; and, since I’m uncertain which actually deserves credit for the copy of the Order, I’ll follow the lead of Y’all where both were mentioned in Breaking Constitutional Spat in Mississippi? Will MSSC and Governor Barbour Square Off. Best title, however, goes to Thus Blogged Anderson for Separation of powers … IN YO’ FACE!

Data in this post were taken from the State Fiscal Year 2009 Budget as passed by the Legislature and found on the website of the Department of Finance and Administration.

6 thoughts on “Well, someone had to, so here it is – Mississippi’s State Budget 101”

  1. The state also got used to all the extra federal funds for Katrina and then stimulus, especially in Medicaid which was able to increase spending while reducing the state’s share from around 30 percent to around 10 percent. No more free Katrina money nor stimulus “stabilization” funds for state operating expenses and the state is in big trouble.

    In effect, the state is just like a guy who lived in a FEMA trailer for four years, spent most of his grant and/or insurance money, and still doesn’t have any plans or permits to rebuild.

  2. What is new. Why are governments so inefficient? Very simple, it is not their hard earned money. It is confiscated from its citizens. There is no profit motive.

    I am a perfect example of this. After the Easter Flood of 1979 in Jackson, the feds threw money at me, including food stamps. I didn’t ask for any of it. We found ourselves being very wasteful with the food stamps. I am not proud of that, but it showed me the deficiencies of our current system.

  3. First off we blog so much about insurance matters it is nice to see my blog partner shine in an area which she knows more than a little. 🙂

    Second the disaster food stamps enabled us to restock our refrigerator when we re-set up our household after the storm. Like Sup I had to be prodded to get the card but was happy to have it after. Our extravagance was a holiday prime rib roast. I didn’t feel too guilty because I’m one of a minority of the citizenry in this country that actually pays the freight via taxation (even in 2005).

    Once upon I time I had a statewide rep as an education auditor before specializing. I still do some consulting in that area. The overspending is terrible but what is worse to me is the money that is flat out wasted. A case in point is

  4. Sup, to put your comment in larger perspective, the government provides what those in positions of influence have convinced decision makers we need.

    You can follow the money on every dime and eventually find out who the real beneficiaries are – and very seldom will it be the individuals in need of assistance.

    Brian provided an excellent example comparing government to someone living in a FEMA trailer with all resources exhausted and no plans or permits to rebuild.

    Let’s take that example and examine how available disaster assistance contributed to that outcome.

    Begin with the assumption this individual’s home was destroyed and everything was lost. Meeting basic human need – food, clothing, shelter was the obvious immediate priority based on the widely accepted Maslow Hierarchy of Need:

    Biological and Physiological needs
    Safety needs
    Belongingness needs
    Esteem needs
    Self-actualization

    However, before disaster “victims” can rebuild, they much reach the level of “self actualization”.

    Given my experience on the Coast, none of the available assistance supported that end. It never will until someone uses Maslow’s work as a guide and we provide services at all levels of need.

    If receipt of the Medicaid reduction in match had required states to reallocate the savings to otherwise unavailable direct assistance to people on the Coast, some of the present crisis could have been avoided as more “victims” reached the level of self-actualization and associated level of economic stability/self-sufficiency necessary for personal and community economic success.

    Instead, we invested in the windpool when a much better idea would have been to invest in services people need to work. A coast-wide system of public transportation, for example, would not only assure people could have gotten to work and back, it would have created new employment opportunities within the system itself and in the communities on the Coast.

    In fact, one large employer that early on asked for help for employees who needed reliable transportation and affordable child care to return to work eventually closed its coastal location – no doubt, our ignoring those needs was a factor regardless of what was eventually cited as the basis for the decision to pull out.

  5. Thanks, Sop. It would take a book to address all the issues! However, the education and mental health issues you identified are the tip of a very big “iceberg” that shows no sign of melting!

    A “suicide prevention curriculum” should make those who understand what was really needed want to kill themselves! It all goes back to the needs identified by Maslow as a guide for determining what disaster assistance services are available.

    I’ve had people tell me that the way their family resolved the need for housing was to all move in together. The size of the combined families exceeded available space making it necessary for people to sleep in shifts. She explained that some adults worked at night freeing beds for school-age children and those adults then had their turn in the bed when the kids were at school during the day. Of course, some had to sleep with one eye open to watch the preschool-age children.

    The list of ways this family coped just went on and on. Unfortunately, I believe this very sad story describes more than just this one family’s post-Katrina life – and that makes the idea of developing a “curriculum” sheer folly and a classic example of someone selling a “pay me to reinvent the wheel”. Wonder who?

    Your last example, the music major turned IT expert, doesn’t surprise me either. However, it does remind me of something that happened years ago.

    A friend in Washington had one of those mid-life moments and wanted to change careers. His new career goal was to work in the “performing arts” at the Kennedy Center of all places. No one in our “friendship circle” could think of anything in his background that would make that a realistic goal – until someone piped up with, “well, he does have a radio”.

  6. I believe the tone of these posts are a reflection of what the majority of the American people are feeling right now. FRUSTRATION! The arrogance of Washington has gone overboard. The cost of the trips to Copenhagan for that farce is inexecusable. The fact MA elected a conservative leaning person to the Senate should send a message. However, Mrs Pelosi is oblivious to what is being SHOUTED at Washington.

    Mr. Taylor is trying to tell them, but they ignore logic.

    I love your MS having lived there twenty-five years. You all have your own controversy with the suggestion of consolidating JSU, ASU and MVSU. I remember when all the state schools were “annointed” university status many years ago. It made no sense then and now it is a drain on the state. MS does not need all these “universities. Forget “Black” or whatever universities. Consolidate DSU with MVSU, MSU with MUW, there is no need for a university in Lorman. USM deserves more attention as it is in the middle of a large population and is draw for students from AL and LA. OOPS, forgot that is logical and politicians do not live in that world.

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