Agency heads tell of cut impact

LINCOLN — The grim predictions came one after another Thursday.

About a dozen state agency heads laid out the possible layoffs, job furloughs and closings over the next 18 months if Gov. Dave Heineman's budget-cutting plan is adopted.

The state's budget director said that as many as 400 workers might have to be laid off next year to help deal with the expected $334 million shortfall in tax revenue.

The picture wasn't pretty.

County courts in 23 rural Nebraska counties would have to be closed, and other state court employees might be furloughed or laid off, said the chief justice of the Nebraska Supreme Court.

Three to four lawyers in the Attorney General's Office would lose their jobs, as would four to five workers in the State Auditor's Office and four to five lawyers with the Legal Aid Society.

State Treasurer Shane Osborn said he's handing out four pink slips in his office, including one to his chief deputy.

“People expect us to tighten our belts, and that's what we're doing,” Osborn said. “This is not going to happen without pain.”

Osborn was one of about a dozen state agency directors who testified Thursday before the Appropriations Committee of the Legislature, which began a special session Wednesday to cut $334 million from the state's recession-ravaged budget.

The fiscal rubber hit the road as, for the first time, state agencies publicly laid out the anticipated impact of Heineman's proposed cuts.

Directors of the State Patrol and Department of Corrections said that they plan to eliminate vacant positions — 17 and 30, respectively — but that the cuts would not jeopardize public safety.

The proposed cut to the Legislature's budget would be the equivalent of laying off one administrative assistant for each of the 49 senators, said State Sen. John Wightman of Lexington, chairman of the Legislature's Executive Board.

More likely cuts, he said, would be to freeze salaries of legislative staffers for two years, furlough staffers for five days or reduce per-diem expenses paid to senators.

While those testifying acknowledged the gravity of the state's fiscal woes, many agency heads pleaded to be spared from cuts or asked that the Legislature avoid borrowing user fees that they receive to help solve the state's overall budget.

There were few alternatives offered, though Len Schropfer of Milligan, Neb., suggested that the state could save money by halting the prosecution and jailing of people for marijuana use.

Gerry Oligmueller, the state's top budget officer, said declining tax revenue requires that all agencies and operations share in the sacrifice.

“These are big numbers,” Oligmueller said. “This is a huge fiscal challenge.”

Chief Justice Michael Heavican noted that 95 percent of the state court budget is salaries and benefits.

Heavican said that means furloughs, layoffs and closing courts are likely to address $1.7 million in court cuts this year and $3.4 million in the 2010-11 budget year.

He showed a map of 23 rural counties where relatively few court cases are filed annually and said laying off all the mostly part-time workers there would save only $375,000. Closing big-city courts for a day or two is also possible, Heavican said.

He and others pointed out that layoffs or furloughs for the state's 500 probation employees could be counterproductive because it would preclude lower-cost options to imprisonment and mean less supervision of those on probation.

One member of the Appropriations Committee, State Sen. John Harms of Scottsbluff, said his goal in the special session would be to avoid layoffs at all costs because they would be harmful to the state's economic recovery.

Toward that end, a legislative resolution was introduced Thursday by Sen. Bill Avery of Lincoln to encourage state agencies to use furloughs — unpaid days off — rather than layoffs to reduce spending.

During questioning Thursday, Oligmueller said furloughs had been dismissed by Heineman as a potential solution because it is only a short-term fix.

When asked by Harms if the governor considered renegotiating the 2.9-percent pay raise granted to state workers this year, Oligmueller said such a step had not been suggested by the employees union when it was asked for budget-cutting ideas.

Oligmueller was also the target of questioning by Sen. Heath Mello of Omaha about the large number of inaccuracies in a first-time state report on job vacancies in state agencies.

Oligmueller said the data were incorrect but that state officials will learn and will fix the errors in the next quarterly report.

The report indicated that more than 2,100 jobs paying $63 million in salaries were vacant. But Thursday, nearly every agency head who testified said the figures were incorrect or outdated.