On Washington visit, Gov. Gary Herbert says falling off fiscal cliff could put Utah into recession
SALT LAKE CITY — Gov. Gary Herbert left the White House on Tuesday thinking he might have to prepare two state budgets — one if the nation tumbles over the so-called fiscal cliff and one if it doesn't.
Utah currently is looking at $420 million in new growth for the coming budget year. But state economists estimate Utah would lose not only that but another $500 million if Congress and President Barack Obama don't reach an agreement on spending cuts, tax rates and other financial issues, Herbert said.
Herbert, who will release his proposed 2013-14 budget in a week or so, said he wants to use the new money for public education, infrastructure and health and human services.
If Washington fails to do something in the next month, "we would have to go back to cutting, and the belief is we would go back into a recessionary economy," he said.
Herbert was among six governors — both Republicans and Democrats — who met with Obama, Vice President Joe Biden and their economic advisers. They also sat down with Senate Majority Leader Harry Reid, D-Nevada, and House Speaker John Boehner, R-Ohio. The governors are members of the National Governors Association executive committee.
"Doing nothing is not an option from our perspective," Herbert said. "It was just a 'git 'er done' kind of attitude."
Herbert other governors, often an afterthought in Washington, he said, received more attention than he expected. He and Gov. Jack Markell, D-Del., were scheduled to be appear Tuesday night with Piers Morgan on CNN.
The governor also met with members of Utah's congressional delegation whom he characterized as a "little more pessimistic" about finding a resolution.
After the meeting with Obama, the governors described the discussion as wide-ranging, touching on economic growth, spending cuts and health care.
Herbert and Gov. Mary Fallin, R-Okla., both talked to the president about giving states more discretion in administering federal programs, especially in the face of spending cuts.
"Just don't put a lot of unfunded mandates back on the states and tie our hands as governors when they have to make some tough choices about the spending cuts that will come down to the states," Fallin said.
Democrats, Herbert said, don't like block grants, but Republicans do because of the flexibility they afford states in deciding how to use the money.
"I believe in my heart the states can do more with less and help the federal government balance its budget," he said.
Obama seemed willing to consider more leeway for states as long as his goals were met as well, the governors said.
"I'm going to take him up on that," Herbert said.
Herbert said the president suggested he work with U.S. Department of Health and Human Services in maintaining Utah's health insurance exchange known as Avenue H. The Affordable Care Act mandates the exchanges, which may be established by the states or left up to the federal government to run.
The governor recently sent a letter to Health and Human Services Secretary Kathleen Sebilius saying Utah intends continue the program it set up several years ago.
Herbert said he's going to test the president on that issue by "aggressively and proactively" working with the federal health department.
Overall, the governor said, the meetings focused on finding solutions. There seems to be agreement among Republicans and Democrats on growing the economy and closing tax loopholes for the rich, Herbert said. The sticking point, he said, is raising tax rates.
"I actually left hopeful that they're going to find a resolution and keep us from going over the fiscal cliff," Herbert said.
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