OLYMPIA — Gov. Chris Gregoire unveiled a two-year budget plan Wednesday that uses a mix of cuts to state programs, suspension of voter initiatives and use of the state's "rainy day" fund to patch a projected $4.6 billion deficit.
In her proposal, Gregoire made about $3 billion in cuts in her 2011-2013 budget to programs across state government. Another $1.1 billion was saved by not paying for two voter-backed education initiatives that deal with teacher pay raises and money for reducing class sizes.
Her plan would leave the state's operating budget with a balance of about $881 million.
She proposed eliminating the Basic Health Program, which provides subsidized medical insurance to 66,000 poorer Washingtonians, and she would eliminate cash grants and medical care for the Disability Lifeline program, which aids mostly childless adults who are unemployable but not receiving federal aid.
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The proposal also would eliminate the Children's Health Program, which provides medical coverage for 27,000 children who could be in the country illegally. A state food stamp program for those who don't qualify for federal food stamps was also cut.
"We have had to cut the unthinkable to prevent the unbearable," Gregoire said.
The biggest reductions were in K-12 education, through both the suspension of teacher pay and class size Initiatives 728 and 732, as well as a 10 percent reduction to a state scholarship and student outreach program.
Also cut was $600 million that would have gone into additional spending on public education, the first phase of a multiyear plan that was dictated under a bill passed during the legislative session this year.
Gregoire suggested a 6.3 percent reduction in levy equalization payments, which help K-12 school districts that have lower levels of property-tax support. Combined, these and other cuts to education save the state $2.2 billion over the next two years.
Higher education would see across-the-board budget cuts of 4.2 percent at both four-year schools and community and technical colleges, saving the state $102 million. The cuts could result in fewer classes being offered, larger class sizes and fewer faculty positions.
Gregoire's proposal would allow colleges and universities to raise tuition for resident undergraduates at set amounts. For example, a student at a community college would see an increase of $280 in fiscal year 2012, followed by a $305 increase in fiscal year 2013. A student at the University of Washington would see their tuition increase by $940 in 2012, and by $1,050 in 2013.
Gregoire proposed a bump in financial aid to help offset costs for students.
The governor would tap about $290 million from the state's Rainy Day Fund, created by voters for budget emergencies, and transfer about $400 million in funds from other accounts to the state's operating budget.
Earlier in the week, she announced pieces of her budget plan, including the consolidation of several state agencies, the elimination of three dozen boards and commissions, and changes to the state pension system. State workers will also see a 3 percent cut in pay through unpaid time known as furloughs, and Gregoire's budget office said that about 2,000 state workers could lose their jobs.
"I hate my budget," she said, tearing up toward the end of her press conference Wednesday. "I hate it because in some places, I don't even think it's moral."
A coalition of critics, including nurses, teachers and workers in community health, immediately spoke out against the proposal. David Flentge, head of Community Health Care in Tacoma, which serves low income patients, called the cuts "a great tragedy" that will affect "the lowest, most vulnerable residents of the state of Washington."
Lawmakers start their 105-day legislative session in January, and Democratic leaders in both the House and Senate will present their own proposals then.
House Majority Leader Pat Sullivan, D-Covington, said that while the House proposal will likely not look exactly like the one Gregoire proposed, "any of the choices we make will have a serious negative impact on the social structure of our state, the education of our children, and the future of our economy."
"We are out of good options," he said in a statement.
Rep. Gary Alexander,R-Olympia and ranking Republican on the House Ways and Means Committee, said the governor's budget "includes some bold moves that are necessary if we're going to break the cycle of unsustainable budgets moving forward."
Tax increases are not a likely option following the November election, where voters rejected several new taxes and placed renewed restrictions on the Legislature's ability to raise taxes without a statewide vote.
"I got the message, I heard it loud and clear," Gregoire said. "I honor the voters of the state of Washington, and the budget is what it is."
Lawmakers this past weekend held a one-day special session to shrink the state's current $1.1 billion deficit. They cut state spending, raids off-budget accounts and counts on stepped-up collection of existing taxes to trim about $590 million from the deficit through June.
Further spending cuts and other steps identified by Gregoire could subtract about $110 million more from the deficit. The rest will have to be addressed in her proposed supplemental budget, set to be released Friday.