Budget woes push lawmakers into uncharted territory: relentless fiscal problems stood out as the biggest challenge facing lawmakers in 2003.

• Author: Eckl, Corina

When most people reflect upon a standout year, they reminisce about noteworthy achievements, difficult to attain accomplishments and stellar performances. Yes, 2003 had some of those characteristics. But this year was marked more by the trials and tribulations of continuing fiscal problems.

In a period of limited and even contracting resources, policymakers had to contend with a host of budget-related challenges, from further court involvement to the ongoing saga of legislative-executive budget relations.

By most accounts, lawmakers succeeded in their 2003 legislative session tasks. With only a couple of exceptions, they finished fiscal year 2003 in the black and enacted balanced budgets for FY 2004. Some even took it upon themselves to exert more influence over the budget process. But the year isn't quite over and, if recent history is any guide, the road ahead still may be difficult.

PASSING THE BUDGET

The serious--and often extreme--nature of fiscal problems made timely passage of state budgets nearly impossible in many states. For some, a budget got passed only after considerable wrangling. But for others, the entire process collapsed, leaving lawmakers to tread new territory.

The Arkansas General Assembly, which became embroiled in a dispute over use of the General Improvement Fund, adjourned for the first time in the state's history without passing a budget. The process broke down because some lawmakers wanted to stop using portions of the fund for local capital projects. Although the legislature initially was able to garner the two-thirds vote necessary to extend the session beyond its 60-day constitutional limit, a subsequent extension failed because a supermajority could not be reached.

The legislature adjourned April 16 without passing a budget, but convened about three weeks later in a special session. The budget stalemate was broken within a week with the General Improvement Fund continuing to be used in part for local projects.

In Florida, for the first time ever, budget negotiations were abandoned with time still left in the regular session. Disagreement over ways to boost revenues caused the impasse, requiring a special session to get the budget finished. In the end, the state used about $1.1 billion of one-time money in the FY 2004 budget. "We shook change out of our pockets to put this budget together," reports Alan Johansen, staff director of the Senate Finance and Taxation Committee.

The Idaho Legislature set a different kind of record. Protracted deliberation of a 1.5-cent sales tax increase proposed by the governor pushed the Legislature to its longest session ever. The 118 days eclipsed the prior record by 23. Ultimately, the Legislature approved a 1-cent increase in the sales tax for three years and doubled the cigarette tax from 28 cents to 57 cents per pack. The Legislature also left 1 percent of projected revenues unspent to provide a cushion for FY 2004. While the length of the session set a new record, the effort was not in vain. The tax increase, in combination with selected cuts, is expected to resolve the state's structural budget gap.

"It was difficult, but we made permanent base reductions because we've been confronted with revenue shortfalls for several years now," says Representative Maxine Bell, chair of the House Appropriations Committee. "With the base reductions behind us, we now plan to take a more in-depth look at specific programs and ways we can achieve cost savings and...