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Doyle’s orders include slashing tens of millions of dollars from the state’s Medicaid program, the University of Wisconsin System and the Department of Natural Resources.
The agencies have until Nov. 17 to submit plans detailing how they’ll achieve the reductions. The cuts likely will occur in the last quarter of the 2008-09 fiscal year, which ends next June 30.
Doyle’s budget director, David Schmiedicke, said in a memo to the agencies they should manage the cuts by finding cheaper ways to do business, looking to cut the money out of slated program funding increases and holding vacant positions open.
“Clearly, it’s going to be a challenge,” Schmiedicke said in an interview.
The sputtering economy created a $652 million deficit in the 2007-09 state budget because the state can’t collect enough in sales, income and other taxes to cover its bills.
Doyle, a Democrat, ordered his cabinet agencies in February to slash $17 million. His budget workers also restructured some of the state’s short-term debt, saving another $125 million.
The governor signed a bill in May that closed the rest of the gap in part by refinancing the state’s tobacco bonds and requiring agencies to return $270 million to the state’s general fund.
Doyle said then about $103 million would come out of highway construction and repair money, but didn’t elaborate on where the rest of the cuts may come. His orders Thursday fleshed that out.
The next biggest chunk after the road reductions — $53.3 million — must come out of Medicaid, a joint state and federal program that covers health care for the elderly, disabled and children. That cut comes on top of a $60 million reduction the governor ordered in Medicaid earlier this year to help close the budget deficit.
Officials at the Department of Health Services, which administers Medicaid, referred questions about where the cuts might come to Doyle’s budget shop. Schmiedicke said the governor doesn’t want eligibility or services curtailed, which means the agency will have to look to bring in more federal dollars and finding other efficiencies, such as cheaper prescription drugs.
The University of Wisconsin System, meanwhile, must slash $25 million. That’s on top of a $25 million cut laid out in the original 2007-09 budget.
Schmiedicke said the cuts shouldn’t come out of the system’s so-called Growth Agenda, a plan to increase student enrollments on some campuses and expand research, noting the reductions represent a small portion of the system’s $4.6 billion budget.
System spokesman David Giroux said it was too early to say where the cuts would come, but the system’s budget writers will try to protect students.
The Department of Natural Resources faces a $13.2 million cut. DNR spokesman Bob Manwell didn’t immediately return a message left seeking comment Thursday, but Schmiedicke said he expects the agency will have to keep positions open and scale back increases in programs.
Assembly Speaker Mike Huebsch, R-West Salem, called the moves a good start toward protecting taxpayers, but complained about taking money from roads. That money is generated through the state’s gas tax and vehicle registration and shouldn’t hold up other parts of the budget, Huebsch said.
Schmiedicke countered the budget as it stands now still allocates $462 million more for roads than the state’s 2005-07 spending plan.
