Is Arizona's Budget Deficit Really $2.1 Billion?

01-05-2011 • AZcentral.com

The report, titled "Structurally Unbalanced: Cyclical and Structural Deficits in Arizona," concludes that with most of the short-term gimmicks exhausted, the nagging structural deficit is exposed as lawmakers return to the Capitol. It warns that lawmakers must take care in what they cut and should consider the other side of the ledger: more revenue. "Budget cuts from this point forward could - if handled crudely - prove devastating and difficult to recover from," the report states. However, if managed well, "the crisis might actually prompt innovation instead of just pain," it says. Murray said state leaders need a conversation about Arizona's long-term priorities. "Strategically, what should you protect?" he said. "Strategically, what should you tax?" These questions - and answers - should form a strategic plan to guide state-budget decisions, the report recommends. While he acknowledged that two- and four-year election cycles complicate the ability to stick to a long-term plan, a strategy produced by a broad cross section of the population could help increase its shelf life.