The Governor's order to state agencies for a 1% holdback with a 1.5% also held in reserve is a prudent step in managing Idaho's finances. The Governor, the Legislature and the Agencies are exerting the principle of responsible fiscal management. The agencies did well to address the economic downturn in 2002, and I am confident they will do so again. Mainly, the agencies will address the funding reduction by finding more efficiencies in existing programs and by prioritizing the most critical needs first, leaving vacant positions empty, and using those salary savings for needed services. The Department of Health and Welfare has an added challenge because they must address the loss of matching federal funds that accompany the loss of state dollars. They are working to find ways to solve this without cutting services that are truly needed.
After the 2002 holdbacks, we established an Education Stabilization Fund to be used for K-12 if the economy has a downturn. Thus K-12 is not receiving a holdback at this time. We know that the children, as the future workforce, must continue to receive quality education so that when the economy turns around, they will be ready to lead Idaho forward. We will work together to manage your tax dollars in a responsible manner. Now is a time to keep spending down and to be extremely careful about any increase of revenues.