The Newport Plain Talk

NASHVILLE (AP)-Gov. Phil Bredesen outlined aseries of deep cuts to bridge a nearly half-billion-dollar hole in Tennessee'supcoming spending plan during a speech to lawmakers Monday.

The governor proposed cuts to TennCare and bothprimary and higher education. Bredesen followed up on the plan revealed lastweek to use voluntary buyouts to trim the state's work force by about 2,000employees by confirming that he's also eliminating a planned 2 percent payraise.

Bredesen, a Democrat, said he will balance the budgetwithout raising taxes. "We can't tax our way out of this shortfall,"he said.

Despite the cuts, Bredesen wants to set aside $100million to help Tennessee land unspecified economic development projects.

Administration officials won't say which projects thatmoney would target. But German automaker Volkswagen AG announced last monththat Tennessee is among three states it is considering for a new assemblyplant.

Tennessee's revenue situation is suffering because"our economy is in a recession and energy costs are soaring,"Bredesen said in a somber 16-minute speech.

"Now that the magnitude of the problem isbecoming clear, we need to act decisively and conservatively," Bredesensaid. "This is not a time for a lack of resolve, this is not a time forwishful thinking."

TennCare, the state's expanded Medicaid program, hadbeen slated for a $100 million increase to help pay for up to 100,000 people inthe "medically needy" category for low-income people with largeoutstanding medical bills.

That expansion would be cut by $80 million underBredesen's plan and would serve a maximum of 20,000 people.

Tony Garr, executive director of the Tennessee HealthCare Campaign, was critical of the TennCare reduction-especially in light ofthe 170,000 adults that Bredesen cut from the expanded Medicaid program in2005.

"This governor who was supposed to be able tomanage health care, the only thing he knows to do is cut health care,"Garr said.

Bredesen's budget plan would cover the inflation costsfor K-12 schools. But it would include no new primary education money or addany pre-kindergarten classes around the state-a decision Bredesen called"a painful step for me but one that is necessary."

The governor urged higher education officials not torespond to a $56 million cut in state funding by heaping large tuition hikes onstudents and their families.

Lawmakers had already been warned about the state'sbleak budget situation, so most expressed little surprise-or opposition-to thegovernor's proposal.

"It's going to be a tough budget, but it's one wewill be able to work with and we will be able to balance," said HouseSpeaker Jimmy Naifeh, D-Covington.

House Minority Leader Jason Mumpower, R-Bristol,called the budget cuts an "unfortunate reality of the economic cycle thatwe're living in."

Mumpower nevertheless praised the effort to focus oneconomic development projects.

"I think we need to do everything we can torecruit new high-paying jobs into this state," he said. "In the worldwe live in today, part of that is offering economic incentives."

Bredesen is aiming to cut $468 million out of thespending plan for the budget year that begins on July 1. The reductions alsoinclude one-time money for maintenance for buildings operated by the state,public colleges and universities, and prisons.

The governor is also eliminating a $10 millioncontribution to the Heritage Conservation Trust Fund for acquiring state parkland and is cutting in half the money available for the state's tobaccocessation program to $5 million.

State Health Commissioner Susan Cooper said she'spleased that the governor kept the program to fight smoking alive. "We'reeternally optimistic because we can do some good things with the money,"she said.

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