Stateline Story

New Governors Facing 'Booby Prize'

It's ten minutes before midnight November 5 and the official word is in you've just been elected governor.

Everyone is shouting in celebration as long and laborious months of campaigning give way to the joy of victory. But behind your euphoria is a nagging thought now you've actually got to govern the state.

Normally this would be no problem. After all, you've got vision -- that's why you were elected. But this year the slumping economy and disappearing tax dollars have conspired to present you with one big headache the state has no money.

"It's always an honor to serve as governor. But I think people who win this year are getting the booby prize big budget deficits and a citizenry which will be very stubborn about accepting tax increases or cuts in programs which affect them or their children," said David Rebovitch, political science professor at Rider University in Lawrenceville, New Jersey.

That means new governors there are 36 gubernatorial contests this year might have a tougher time selling their budget plans to a skeptical public than they did selling themselves. States face an aggregate deficit approaching $60 billion. Few are unaffected.

"New governors are going to have to move from an election campaign this fall into a campaign to sell budgets containing cuts. It wouldn't surprise me, this is based on New Jersey's experience and other states, that the governors' budget campaigns starting next January will be more difficult than their election campaigns," he said.

In New Jersey, budget concerns have dominated the first year of Democrat James McGreevey's term as governor.

Beginning just days after his election last November, McGreevey began sounding out about the depth of the state's budget problems. He repeatedly criticized his Republican predecessors for poor management state finances.

"They were waltzing through the graveyard," McGreevey said after taking office. "I call it willful irresponsibility."

The budget problems forced a reordering of priorities in McGreevey's office. Education was pushed to the side. Jobs were cut. Spending was frozen. The state's bond rating was downgraded. Tobacco settlement money was borrowed against.

As McGreevey put it: The budget is "the overarching concern, challenge, passion for the administration."

Voter's response? McGreevey, who was elected with 56 percent of the vote, now has an approval rating in the low 40's.

In Virginia, Democrat Mark Warner, the nation's other first-year governor, has had to confront similarly difficult fiscal realities.

Just after his swearing-in, Warner penned an op ed article for the Richmond Times-Dispatch titled: "State's Top Priority Will Be Its Budget." In it, he said the state's legacy of good government was threatened "by the current condition of the state's finances."

To get those finances back in order, Warner slashed funding to higher education and ordered agency heads to draft plans for deep budget cuts. On October 15, Warner announced $858 million in emergency spending cuts, including 1,837 state government layoffs. The most recent cuts closed only half the state's budget gap.

The budget cuts are coming from a governor whose campaign promises included raising teacher salaries to the national average, phasing-out the car tax and providing incentives for technology companies to locate in rural Virginia.

Nick Jenny, a fiscal analyst at the Rockefeller Institute of Government at the State University of New York Albany, said the poor economic conditions forcing McGreevey and Warner to cut programs and consider tax increases are the same ones that will greet the nation's new governors.

"Nothing is good from the revenue point of view. Revenues still seem to be sluggish. . . .It makes what was already a pretty bad situation worse," he said. "A lot of the budget reserves have been used. A lot of states have used their tobacco money already. They may have to go to some of the bigger guns major spending cuts, major tax increases."