Our Opinion: It's the budget, then everything else

With Arizona's 90 legislators getting together Monday in Phoenix for the beginning of their 2009 session, there is only one topic to discuss.

Money.

A month ago, BusinessWeek magazine said that percentagewise, Arizona had the worst budget problems in the nation, with a $1.3 billion deficit in its $9.9 billion budget for fiscal 2009.

That's old news. Arizona's deficit now is projected at $1.6 billion - and rising.

That is for the fiscal year ending June 30, when the state must close its book without a deficit.

Figuring out how to make those massive - and massively unpopular - cuts will be the only thing the Legislature does this year that really matters. And once that is done, lawmakers must immediately start work on next year's budget - which is hemorrhaging red ink at an even more rapid pace.

Amid all of this, Arizona is going through an unexpected gubernatorial shuffle. Democrat Janet Napolitano will deliver her final State of the State speech Monday, then dash off to Washington, D.C., to begin confirmation hearings as President-elect Barack Obama's secretary of Homeland Security.

She will be replaced by Jan Brewer, a Republican who is poles apart from Napolitano philosophically but closely aligned with the GOP majorities in both houses of the Legislature.

Napolitano will make recommendations for fixing the budgets for this year and next. But it is the Legislature that is expected to take the lead in deciding what to cut.

There already have been budget fireworks with political undertones. State Treasurer Dean Martin, a Republican, has said Arizona will have to borrow vast sums just so its checks don't bounce in the next few months.

Martin would like to be governor, and Napolitano brushed off his warnings as political histrionics.

Legislative leaders have said they will delay all bills until the current budget is balanced - a smart move that puts the most critical matter front and center.

Because of constitutional requirements, voter mandates and other factors, legislators are severely limited in what they can cut. Education - from state-funded all-day kindergarten to the universities - has been prominently mentioned as a likely target.

Education has been cut and will be cut more. That's a fiscal reality. But the state economy will recover, and cuts must be made with an eye to emerging from this recession strong.

Decimating education will do irreparable harm to the state's ability to pull itself back up. Companies don't want to locate or expand in a state with poor schools. And the universities bring in millions of dollars in research funding.

Legislators have an unenviable task awaiting them over the next few months. While they must deal with a short-term crisis, they must also focus on better days ahead.