August 5, 2005
By Governor Haley Barbour

Operation: Streamline—A Return to Fiscal Responsibility

When I took office, Mississippi was in a $700 million budget hole and prioritizing in state government wasn't seen as necessary. The Legislature was in the habit of raiding special accounts and using one-time money to plug the hemorrhaging of red ink.

It took years for Mississippi to get itself into this budget crisis, and we have been working diligently over the first year and a half of my term to dig ourselves out. I offered an honest, straightforward plan called “Operation: Streamline” to eliminate our shortfall. Today I am proud to report that we’ve almost returned to structural balance without raising anybody’s taxes.

We’ve also reduced the reliance on special fund revenue being used for funding the rest of state government. The year before I was elected Governor, the Legislature used $277 million in special funds to balance the budget. Today I am pleased to tell you that this careless practice has been significantly reduced to $23 million for fiscal year 2006.

No New Taxes

I pledged to balance the budget without raising taxes, and we’ve done it through a combination of savings and growth. A growing Mississippi economy is generating more taxpayers and more taxable income. Last year personal income grew by the highest rate since 1998 and employment grew more than any year since 1999. As a result, state revenue increased last year by nearly 8 percent, almost $300 million. That’s the way to fund our priorities.

Mississippians knew that state government was spending too much, and today I am glad to inform you that state expenditures for the next fiscal year will actually decline by almost 2 percent.

Fund Priorities

With a decline in state spending, we were still able to fund our priorities. Education is rightly the top priority for state government. More than 62 percent of next year’s budget will go to education; nearly 50 percent of that budget will be spent on K-12 alone. Despite the recent claims that K-12 education was being “cut,” the debate this year was solely over how big an increase they were going to get. Today I am pleased to tell you that the budget fully funds an 8 percent pay raise for public school teachers and increases K-12 funding by 7.2 percent overall.

This is a noteworthy increase, considering most state agencies were required to save 5 percent, and we were able to balance the budget in tough financial times without raising taxes.

After five years of cuts and an increase in student population, the budget maintains level funding for higher education plus significant additional funding for community colleges for workforce development and job training. The budget doubles the state support for workforce training while cutting state payroll taxes by 25 percent.

The budget funds a highway patrol training school to increase the number of law enforcement officers and maintains level funding for law enforcement and the National Guard. It saves money by reforming programs such as Medicaid.

“Operation: Streamline” is certainly a return to fiscal responsibility. Just as Mississippians sit around their kitchen table and balance their checkbooks, elected officials must also be held accountable for being good stewards of your tax dollars.

I am proud of what we have been able to accomplish together so far. It’s been a tough row to hoe, but the outcome will positively affect all of us for years to come.



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Governor Haley Barbour
P.O. Box 139 Jackson, MS 39205
Phone: 601.359.3150 Fax: 601.359.3741

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