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Friday, August 3, 2012 - 11:15am

Deal Orders More Budget Cuts

Governor Nathan Deal is asking state agencies to find another %553 million in budget cuts.

The order marks the fifth straight year the Governor's office has told department heads to come up with additional reductions.

The cuts again hit higher education and public health.

Together, the University System of Georgia and Department of Community Health are shouldering about half the Governor's requested cuts.

Most K-12 school funding is spared.

Jeff Humphreys of University of Georgia's Selig Center for Economic Growth says, the reductions surprise him.

"They are not necessary if everything goes perfectly," Humphreys says. "In other words, if we don't go back into recession and we don't get additional mandates from the federal government."

But Humphreys says, there's a 25% chance the economy will go back into recession and Congress could push its budget problems onto the states.

Many agencies are waiting to respond to the order.

Some will consider layoffs.

"Right now, I think that taxes that we have in place in Georgia are capabale of generating revenue growth of close to 5%, maybe a little less than 5%, about the same kind of growth that we saw last year," Humphreys says. "But that's assuming we avoid a recession."

Humphreys says, uncertainties in Europe over the economy and in Washington over the federal budget make it hard for states to predict revenues.

National job figures released Friday show that over the past 30 monhts, governments have cut about the same number of jobs as private companies have added in manufacturing.

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