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Napolitano seeks public input on budget crisis via Web site

Second-guessing elected officials isn't just for venting steam anymore. It may be a way to save the state some money as lawmakers try to figure out Arizona's budget crunch.

Gov. Janet Napolitano on Oct. 15 announced Openness and Savings Strategies, a new Web portal on the state government's site that allows people to submit their own suggestions for alleviating a budget shortfall that might surpass $1 billion. The site also includes budget-management news and money-saving tips for state employees.

"One of my goals as we manage our way through this budget situation that we are in is to try to be as open and also receptive to new ideas as we can be with the people of Arizona," Napolitano said during her weekly press briefing. "Sometimes you find that someone who has been at an agency for 10 or 12 years, they really know some kind of form they've been spending time on that really isn't necessary, or some kind of report that they're required to write that really doesn't provide much useful information."

Napolitano said some agencies have implemented self-initiated policies to save money. The Department of Public Safety, for example, figured out a more cost-effective way to do oil changes on its vehicle fleet. Also, the Department of Commerce has changed the way it deals with state contracts that are in dispute, Napolitano said.

"They all add up when you are running a large state government," she said.

Last week, the governor announced all state contracts of more than $50,000 would face a review before going forward in an attempt to bridge a possible 10-figure shortfall in the state's fiscal year 2009 budget. Napolitano said the state will post information about all such contracts that are approved on the new Web portal, www.az.gov/oss.

The governor's press briefing came as the Legislative Finance Advisory Committee announced that Arizona's $9.9 billion budget could fall short by a minimum of $700 million and by as much as $1.1 billion. Many lawmakers have urged Napolitano to call a special legislative session to deal with the shortfall.

Napolitano has said at least one special session will likely be necessary to sort out the budget problems, but that she would not call for one until after the election. She said a combination of lack of information – the state still does not have the student enrollment numbers that determine public school funding – and election campaigning would likely preclude the Legislature from resolving the budget crisis until after Nov. 4.

In the interim, Napolitano said, the state will continue to search for and implement cost-cutting measures, though she said that simply reducing expenditures is unlikely to compensate for the entire gap in the budget.

"We know that we have to balance this budget by the end of the year, but cutting expenditures is not going to do it. We don't have that kind of liberty in this budget. We don't have that kind of freedom. We pay for public schools, we pay for universities, we pay for AHCCCS (Arizona Health Care Cost Containment System) and we pay for prisons. And when you take all those things together, that about makes up the entire budget," Napolitano said.

One possible revenue source that Napolitano said she has not yet factored into the budget discussions is the possibility of a federal stimulus package. The U.S. House of Representatives is discussing a possible $160 billion stimulus package, the governor said, with much of the money going to the states. Of course, there likely won't be any movement on that until the next Congress is sworn in, she said.

"There are some big ifs out there, and, like I said, we're going to have to work through this day by day, week by week," Napolitano said.

Napolitano has suggested that federal help could aid Arizona in reducing the budget shortfall. In early October, she sent an invoice to the U.S. Department of Justice for $5 million the federal government owes Arizona for housing illegal immigrants in state prisons for the past five years. She also billed the feds for interest.

The governor also said she is still considering securitizing money owed to the state in a settlement with tobacco companies. Napolitano said numerous other states have done the same, which entails selling the debt to a private entity for cash up front.

 "I'm far from deciding that. What I am saying is … we're looking at everything," Napolitano said. "We're also looking at securitizing some or all of the Lottery payments. Is that something we would do absent a big budget deficit? No, absolutely not. … Might it make sense in this situation that we have? It might."

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