On Friday the Governor signed legislation that would reduce state funding and decrease the current shortfall in this fiscal year.  

Though the majority of the funding reductions sent to the Governor by the Legislature were approved, the Governor did veto a handful of items, worth about $6 million in cuts. 

In her veto letter, Governor Gregoire stated:

• Percent Pay Reductions: The legisatively passed budget would reduce the pay of many non-represented state employees by 3 percent beginning April 1 for a savings of $3.4million in the state General Fund.  While the Governor’s 11-13 budget proposal includes an employee pay reduction for all state employees, the early implementation date in this bill is not achievable and would have unintended consequences.
• Depart of Information Services, Prohibition on Expenditures to Equip the State Data Center: Budget language prohibits DIS from spending any funds for the purchase or installation of equipment for the new State Data Center. This prohibition will not save any money and will significantly delay Data Center operation and budget savings made possible by the consolidaiton of existing data centers.
• Communications Staff Savings: The budget requires agencies to achieve $10 million of savings through reduction in communications functions in the executive branch. Given the importance of the work performed by these employees, ranging from providing information on real-time traffic to public health concerns to unemployment insuranced and licensed child care facilities and the budget, it is difficult to see how the public would be served through the sudden and dramatic elimination of these staff.
• Management Efficiencies in the Department of Social and Health Services: The budget requires DSHS to achieve state General Fund savings of $1.7 million by reducting management staff and administration in addition to achieving other efficiencies. The proposed reductions would jeopardize the department’s ability to implement the program changes required in the budget.

Despite the passage of the supplemental budget the state remains in the red. In total, the budget slashes the estimated deficit by about $370 million, with about $242 million in cuts and $125 million in transfers.

The Office of Financial Management estimates that the remaining projected deficit for this current fiscal year is $226 million, adding in the money not saved from the vetoes. The fiscal year ends in June.

“The March forecast will provide remaining information to complete the final supplemental,” Gregoire said in a statement. “The Legislature now must turn its attention to the immediate challenge of addressing the 2011-13 budget. This will not get easier with time.”

Among some of the ideas to finish patching up the deficit to the current fiscal year is delaying state payments to school districts by one day, essentially kick up the payment to the next two-year budget.

Lawmakers have spent more than a month of the 105-day legislative session trying to come up with this agreement, and now, Gregoire and legislators will have to tackle an estimated $5 billion deficit in the next two-year budget, which is roughly $37 billion.

The Senate voted 37-10 and the House voted 55-41 to approve the package.