As a new year gets underway in Mississippi, Barbour unveils his agenda
No tax increases, more fiscal responsibility, more jobs

Two weeks ago, DBJ Publisher, J. Scott Coopwood, and DBJ Contributing Writer Sid Scott, visited with Governor Barbour over a long lunch and talked about his agenda for 2005. This is a portion of that interview.

Q: Governor Barbour, here we are a year into your first term. How does the state’s economic forecast look to you?

Barbour: I am very positive after our first year. State economists reported last week to the Legislature that job growth is the greatest since 1999. Personal wealth is higher than it has been since ‘98. These are very good indicators of positive results in this first year. The Legislature, as you know, overwhelmingly passed my Workforce Delta jobs training program, they passed my Tort Reform bill, which while it was contentious, was passed by the Senate by a 3 to 1 margin and by the House by a 2 to 1 margin. And it’s already paying dividends. We’ve seen the largest medical liability insurance provider in the state say that they are not raising rates for the first time in years. Blue Cross Blue Shield actually announced that they were cutting some rates for some of their customers. We are seeing companies who were passing Mississippi over because of lawsuit abuse talking to us now about possibly having businesses here.

Q: What about taxes, bonds and the special session?

Barbour: One of my top economic priorities was no new taxes. No tax increase got out of committee during this past session. We also had a successful outcome for our job creation bond session. We put out about 100 million dollars in bonds every six months. We wanted to limit the amount of new bonds to about $400 million over two years. So that we would have no increase, or the net increase would be insignificant. I did that because the bond indebtedness went to $500 million in 1991 to $3.2 billion in 2004. We have to stabilize that. Speaking of bonds, you are not going to see any economic incentive come out of this administration where the taxpayers put up all the money. For example, at Textron in Greenville the state and local governments combined to put up just a little over two million dollars. Textron put up $35 million. At the FedEx distribution center in DeSoto County, the state and local government put up around $3 million. FedEx put up over $55 million. In an incentive package that we did while I was governor, for Baxter Labs in Cleveland, the state puts up $8 million, $2million grant, and a $6 million loan. And Baxter puts up $50 million. So, you are not going to see in this administration the taxpayers putting up all of the money or most of the money, and I don’t want to see the taxpayers put up the first money. That’s not the way to do business.

Q: What are some of the highlights of your proposed education budget for next year?

Barbour: On the recent budget that I produced we’ve proposed no tax increases, all the major increases for K-12 education and a fully funded teacher pay increase. We are going to put more money into supplies, textbooks and more teachers for middle schools. For the rest of the K-12 budget, the non-instruction part, we asked them to save five percent.

Q: What about Medicaid and its place in the budget?

Barbour: Our budget proposal is to limit expenditures for Medicaid by 10 percent. It will be hard. Last year I asked the Legislature to give me the authority and flexibility to manage all the agencies and authorities that report to me. Well the Legislature wouldn’t give it to me for everybody, but they did give it to me for the Department of Corrections. Their budget had been skyrocketing, running with large deficits. This year the Department of Corrections is going to spend five percent less than we did last year. Other agencies can do that but we have to give them the flexibility and authority to manage their efficiency. And that’s what I am proposing.

We’ve simply got to get a control on Medicaid spending. It’s not a challenge; it’s not a problem. It’s a danger. Many states now spend more on Medicaid than they spend on education. We spend 62 percent of our state budget on education. We will know how much abuse of Medicaid is going on by this time next year. We will require all people who are on Medicaid physically to come down and reestablish their eligibility to be on the program. I’ll tell you the last administration was not very concerned about controlling cost or about eligibility. I am very concerned about it. Everybody on Medicaid ought to be eligible. Because people who work two jobs to support their family shouldn’t have to pay for insurance for people who could work but choose not to. Right now we do food stamps on an electronic benefit card. Just like a mini-bank card. You go to the store and they swipe your EBT card and lets say you buy $40 worth of groceries; it subtracts $40 from what you got. We are talking about taking that and making it work for some other things, childcare vouchers, and other things like Medicaid. We are not there yet. The biggest thing that we are going to do right now, starting next month is bring people in, in person to reestablish their health benefits. We need to re-determine eligibility annually. When I became Gov. we could only re-determine by mail 120,000 annually. We have 760,000 on Medicaid. At a maximum we could predetermine eligibility every 6 years. We are changing that. Whether we find one person, 1% or 100,000 who are not eligible, but whatever we find we will fix it.

Q: Any chance of benchmarking with other states and their human services departments to gauge where Mississippi is?

Barbour: The dept. of human services actually does some of that and reports it to us. We have 760,000 on Medicaid. When I was elected we had 720,000 and we found out during the middle of the year that it had gone up, and we are trying to be more aggressive about managing Medicaid cost. State law says that if Medicaid is running at more than a 12% deficient I have to take executive action to remedy it. The last administration ignored that; I’m going to go by the law. By the end of Jan. we will get the reports showing where we are. By the end of Jan. either the Legislature will have to act or I will be required to follow the law and make the savings. I am just not going to disobey the law. The law appears to give me a lot of latitude. DBJ