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State leaders painting dire budget picture
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Sen. Eric Johnson and Effingham Schools Superintendent Randy Shearouse talk about education initiatives. - photo by Photo by Pat Donahue

Effingham County business and government leaders got a first-hand look earlier this week at just how deep the state’s fiscal problems are.

As part of the Effingham County Chamber of Commerce’s Effingham Day at the Capitol, participants broke into several groups to visit with pertinent lawmakers and state agencies to push for projects and initiatives seen as vital to the county. And they were told how little help could be forthcoming from the state.

“You got a good taste of what we’re going through up here,” state Sen. Jack Hill (R-Reidsville), the Senate Appropriations chairman, said.

State officials are trying to figure out how to plug a $2.2 billion hole in the budget and some of the proposals are meeting stiff opposition.

“It’s tough out there right now,” said state Rep. Buddy Carter (R-Pooler). “There are going to be some things that hurt.”

To help balance the budget, Gov. Sonny Perdue has said he will rescind the homeowners tax relief grant, which will mean more than $400 million to the state’s bottom line. But Lt. Gov. Casey Cagle and Speaker of the House Glenn Richardson are vowing to keep the grant.

“We have an obligation to meet that this year,” said state Rep. Jon Burns (R-Kildare), “and we need to meet it.”

There’s also a charge for hospitals and insurers to help close the gap on Medicaid costs that has hospital groups bristling. The proposal could cost the Effingham Hospital more than $200,000, according to CEO Norma Jean Morgan.

“The hospital has a valid concern,” Carter said. “That’s going to have a big impact.”

Sen. Eric Johnson (R-Savannah), who stepped down as president pro tem of the Senate as he gears up for a race for lieutenant governor in 2010, also discussed how difficult it may be to trim this year’s spending to match revenues.

When the Republicans gained control of the General Assembly five years ago, “we found a lot of the low-hanging fruit,” said Johnson. “But the low-hanging fruit is gone. When we’re talking about cutting the money we are talking about, it affects real people.”

Under the direction of the governor, state agencies have been looking at cutting 10 percent from their previous budgets. That could mean the loss of long-term beds at the Georgia Regional Hospital in Savannah, Carter said. He also issued concerns over finding a way to fund the state’s trauma care network.

Dr. Fred Mullins, medical director of the Joseph M. Still Burn Center at Augusta’s Doctors Hospital, visited state lawmakers Monday to stress the importance of trauma care. The burn center treated 18 of the workers hurt in the Imperial Sugar refinery explosion last February, and their first stop for medical care had been the trauma center at Savannah’s Memorial University Health Center.

Without that level 1 trauma care center — the only one south of Macon in the state — the number of fatalities would have been higher by 10 or 12, Carter related.

Legislators also are weighing a one-cent sales tax for transportation projects. How that tax would be assessed and collected — either statewide or regionally as counties enter into agreements to levy and disburse the money — remains to be worked out.

“Whether it’s a state tax or a regional tax, we need to be on the ball,” Burns said.

President Obama’s $800-plus billion stimulus package, known as the American Recovery and Reinvestment Act of 2009, has passed the U.S. House of Representatives. But its fate in the Senate is uncertain.

“Whatever happens in Washington has an affect on us,” Carter said. “I hate to have to depend on Washington.”

The state has about $1.2 billion in reserves, and Gov. Perdue is expected to spend about $400 million-$500 million in the FY2009 amended budget and the coming FY10 budget.

“On balance, we’re in pretty good shape,” Hill said. “Alabama’s used up what reserve they had. This year, their reserve plan is a line of credit and I know what a line of credit is — it’s a loan.”

There’s still reason for optimism, he said, even as companies across the nation jettison hundreds and thousands of jobs by the week. He pointed to the Kia auto plant under construction near West Point and the Volkswagen plant that will be built in Chattanooga, Tenn. The VW plant is expected to have a huge impact on the northwestern part of the state.

Plus, the Savannah port continues to be busy and is growing, although slowly, compared to other East Coast ports.

“We’re well-positioned to succeed,” Hill said. “I’m very confident about the future.”