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Unending Tough Budget Choices: What to do with the “Small Things”?

By NASBO Staff posted 02-13-2012 12:00 AM

  
Last summer out west I saw a state park on the map and decided to drive out and hike there, only to arrive and find it was closed.  While state parks make up less than one percent of most state budgets, their treatment in budgets is symbolic of the very tough decisions state officials will have to make as they continue to develop their state budgets this year.  As state monies increasingly go to large parts of the state budget like K-12 education and health care, state officials have to decide how to deal with the smaller discretionary parts of their budgets. That’s not easy since K-12 may be popular and hard to cut, but so are the smaller parts of the budget – like state parks, science museums, public broadcasting and other programs.

State parks are symbolic of this budget-making dilemma a lot of state officials face this year. When Medicaid is growing at about 10% and revenue is tight, there’s only so much money to divvy up. If discretionary programs -- whether they're state parks, arts programs, mental health or drug rehabilitation programs -- are to be funded using traditional means (or not disproportionately cut), something else is cut or taxes must be raised. 

The “big” areas of the state budgets such as Medicaid and education (which make up 64% of general fund budgets) will need to be revisited, perhaps money could be redirected for other purposes, but we all know that’s extremely difficult politically.  None of the alternatives are easy, or frankly, they would have been done.

State parks symbolize the other alternatives states have begun to utilize.  They have been turning to other sources of revenue such as user  fees and corporate sponsorships.  To make up for much or all of the loss of state general however, fee increases often need to be substantial and rarely are corporate sponsorships significant enough to make up for much of the loss of state funds.  That's why many states have closed a number of state parks.  State Legislatures magazine recently talked about “Parks in Peril” in their January issue.  States from Idaho to Massachusetts to Georgia have closed state parks or curtailed hours.  They've raised fees and in some cases have some successful corporate sponsorships for trails or other purposes.

All of this serves to underscore what I see as the fiscal situation states are facing for the next few years.  They'll have more revenue coming in but the stacks of bills are a lot higher than the stack of money coming in.  How they've been dealing with state parks demonstrates the choices - at the macro they have to decide where to cut.  And the way the math works - political and other constraints cause most money to go to the big programs - cuts disproportionately hit smaller, discretionary parts of the budgets like parks.  At the micro level that means tough choices: what to cut, close, stop doing and what other fund revenue can we turn to.  Universities have the ability to raise tuition and fees, parks can raise fees and try and raise other revenue with corporate sponsorships.  Some of this might not be bad ideas, but they still involve tough choices.

-- Scott D. Pattison, Executive Director
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