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Arizona governor to balance budget by cutting universities, other programs and gimmicks

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PHOENIX — Arizona Gov. Doug Ducey will slash 10 percent from state university funding, give only a token increase to K-12 schools, and essentially double the current $8 vehicle license fee as part of a plan to balance the upcoming state budget that was released Friday.

Those are just a few of the cuts, revenue increases and gimmicks the new Republican governor is proposing. Ducey is trying to close a $533 million shortfall in the budget for the 2016 fiscal year that begins July 1.

The proposal fails to include substantial funding to settle a long-running school funding lawsuit where the state faces about $2.9 billion in payments over five years. It did include a boost to bring funding up to where Republicans believe it should be, a number at least $250 million below what a judge has already ordered the state to pay this year.

During a news conference before the budget's details were released, Ducey said that his plan reflects a goal of reaching a true structural balance by the 2017 budget year without tax increases.

"It asks all areas of government to share the work, tighten the belt and find savings," Ducey said. "It sets priorities, and it will also protect vital commitments like public safety, justice, classrooms and aid to the needy and vulnerable."

Ducey was joined at the news conference by House Speaker David Gowan, Senate President Andy Biggs and their appropriations committee chairmen. The joint appearance signals that the majority Republican leadership generally supports Ducey's plan, something that hasn't happened for years.

"After seeing budgets come and go for more than a decade, I can tell you that it's really exciting for me to stand with the governor on the day that he presents his budget to the state," Biggs said.

The current budget includes $9.27 billion in general fund spending. Budget director John Arnold said Ducey's plan closes a $160 million shortfall there by transferring $126 million from the state's rainy day fund, making $35 million in program cuts and reducing payments to health care providers.

But the major cuts come in the budget year starting July 1.

PHOTO: Arizona Gov. Doug Ducey, center, joined by Republican legislative leaders Senate President Andy Biggs, left, and House Speaker David Gowan, speaks at a news conference about his proposed budget at the capitol in Phoenix Friday, Jan. 16, 2015. Ducey only hinted at cuts to come. Those details will come when the budget is released in the afternoon, but he implied that universities would get less money.   (AP Photo/Arizona Capitol Times, Rachel Leingang)
Arizona Gov. Doug Ducey, center, joined by Republican legislative leaders Senate President Andy Biggs, left, and House Speaker David Gowan, speaks at a news conference about his proposed budget at the capitol in Phoenix Friday, Jan. 16, 2015. Ducey only hinted at cuts to come. Those details will come when the budget is released in the afternoon, but he implied that universities would get less money. (AP Photo/Arizona Capitol Times, Rachel Leingang)

Ducey's proposal cuts $348 million in overall spending, increases revenue by $62 million and raids employee health funds, the Arizona Commerce Authority and highway funds to the tune of $303 million.

That leaves overall general fund spending for the 2016 budget year at $9.1 billion.

Ducey touted his budget as putting $134 million more into classroom spending. That includes $85 million for an inflation boost and $74 million to make up for previously missed boosts.

"We're focused on putting the dollars to teachers teaching and students learning — and this budget reflects that," Ducey said.

But then Ducey directs schools to cut $113 million in non-classroom spending and cuts $10 million from extra charter school aid.

That leaves public schools with just a $10 million increase. But there's more: Ducey also eliminated $24 million available for successful schools and moves it into a fund for new building and repairs.

The state's three universities will see a $75 million reduction from the current year's $768 million in state aid. University regents and university presidents met to discuss the cuts Friday.

Arizona State University President Michael Crow said he didn't understand the logic of the cuts, while promising not to raise tuition for in-state students "period, no matter what."

Universities "are a principal contributor within the state, if not the principal contributor, to the performance of this local economy and the new emerging knowledge economy," Crow said. "This strategic asset is now ranked, according to the cuts, as the lowest priority in allocation of the budget model being presented to me. It's just out of alignment to me."


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PHOTO: State Rep. David Gowan speaks during a press conference at the Executive Tower in Phoenix before the release of Gov. Doug Ducey's budget on Friday, Jan. 16, 2015. (AP Photo/The Arizona Republic, Cheryl Evans )  MARICOPA COUNTY OUT; MAGS OUT; NO SALES
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