The bad news was delivered as the House prepared to approve an $18.6 billion budget propped up by $1.4 billion in federal stimulus funding. It passed the House 123-49 and now heads to the Senate.
The House budget sets state spending for the fiscal year starting July 1 slightly below what it was this year. And this year’s budget included spending cuts of more than $2 billion.
Tax collections generally lag economic recoveries. So even if the economy picks up in late 2009 or early 2010, state tax collections could remain low for a while.
Richardson warned his House colleagues to prepare for the worst.
“People aren’t making any money, they aren’t paying any taxes, and they don’t have any more money to pay taxes with,” he said. “It’s getting worse by the day. The cuts you see today are the tip of the iceberg.

“I think we’re going to come back here, with revenues declining as they are, and we’re going to have to say we’re going to have to cut some services,” he said. “We may close some museums. We may close some universities or colleges. We might have to close parks.”
Richardson’s comments followed complaints from House Minority Leader DuBose Porter (D-Dublin) that the budget plan amounted to a property tax increase because it cut school funding and didn’t fund the homeowners’ tax relief grant program. The grants, which cost the state $428 million this year, reduce a homeowners’ property tax bill by $200 to $300. Without the state money, Porter said county officials will pass the cost on to homeowners.

“We can’t allow for bad economic times to be an excuse for not funding programs you don’t believe in,” Porter said, directing his criticism at Republicans.
Richardson argued that local officials will have to tighten their belts, too.
He said a group of teachers told him this week that they couldn’t afford to be furloughed for a few days, as some lawmakers have suggested.
“Which would you rather do, have six days off, or have 6,000 teachers [laid] off?” Richardson said he told the teachers.
Under the House budget plan, federal stimulus money would be used to prevent cuts in payments to hospitals, doctors and other medical providers.
But in a letter to Richardson and Lt. Gov. Casey Cagle, Perdue said the House budget would lead to a potentially devastating shortfall in Medicaid, the public health care program for 1.5 million poor and disabled Georgians.

The Department of Community Health is projecting a 9 percent rise next year in Medicaid enrollment as unemployment climbs and Georgians are left without health coverage. Perdue’s staff said the stimulus money won’t be enough to cover that increase without spending cuts.
The governor said that the budget will need $140 million to $150 million more to pay for growth in Medicaid rolls.
Cagle, the Senate’s president, agreed that the House “underfunded” Medicaid.
But House Appropriations Chairman Ben Harbin (R-Evans) said his chamber used the Medicaid agency data to set a budget.
He said hospitals and doctors wouldn’t be available to treat Medicaid patients if lawmakers agreed to Perdue’s plan to slash what they are paid.
“They haven’t had a rate increase in seven years, and he wants to whack them really hard,” Harbin said. “That’s ridiculous.”