Issues - Balanced Budget
Mississippi’s Balanced Budget
Governor Haley Barbour’s conservative fiscal policies have balanced the state's budget without raising anybody's taxes.
When Governor Barbour took office, Mississippi was in its worst financial shape since the Great
Depression: The state had an estimated $720 million budget shortfall, and our state debt had increased 37% in the previous four years. Almost immediately, Governor Barbour addressed the state’s dire financial situation by proposing “Operation: Streamline” to run state government more efficiently to save taxpayer dollars. In 3 ½ years, Mississippi dug out of a $720 million budget hole and began rebuilding our rainy day fund. This was accomplished while funding increased for major priorities, like education and law enforcement, and without raising anyone’s taxes.
FUNDING PRIORITIES
Working together, Governor Barbour and the Legislature got control of state spending by reforming
programs such as Medicaid and the prison system. By streamlining many government functions, Governor Barbour was able to save money while still funding top priorities. Public education is at record funding levels, while the Mississippi Highway Patrol has received funding for more Trooper schools and officers have even received two consecutive pay raises. The drug enforcement budget has increased by 20 percent, and drug arrests—including a 73 percent increase in 2005—are on the rise.
INCREASED REVENUES AND SAVINGS
We got control of our state budget by spending less than the state collected from taxpayers. For example, in Fiscal Year 2006, state spending grew less than 1% while state revenues increased more than 10%, without raising anybody’s taxes. More revenue means that Mississippi has more taxpayers and taxable income. Governor Barbour’s proven philosophy that raising taxes is the enemy of controlling spending has ushered in a wave of financial stability in Mississippi: Not only are revenues increasing, but state savings are increasing, too.
When Governor Barbour took office, the state’s savings account – our “Rainy Day Fund” – had been
depleted to pay for increased spending. When Governor Fordice left office, Mississippi had $233 million in its Rainy Day Fund. The next four years, the state spent that down to just $22.6 million. Governor Barbour vetoed a bill that would have kept raiding the Rainy Day Fund and insisted that we get control of spending to balance our budget. Now, we have $246.6 million in our Rainy Day Fund. That’s fiscally responsible.
PAYING OFF OUR DEBTS
After state debt exploded between 1990 and 2004– increasing 428% in 15 years – Governor Barbour has
stopped State Government from swiping its credit card every time it has an opportunity. In 2005, for the first time since 1987, the state paid off more debt than was issued. Bonded indebtedness actually went down, providing financial relief for generations to come. Future generations of Mississippians owe less today than when Governor Barbour took office.
Governor Barbour’s conservative fiscal policies, such as controlling state government spending without
increasing taxes and increasing state revenue through economic growth, have resulted in a strong, honest budget for Mississippi.
With a governor committed to not raising taxes and maintaining a structurally balanced budget,
Mississippi is poised for job creation and continued long term growth.