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Gov. Otter orders additional 3 percent holdback
Directs state agencies to hold 2 percent more in reserve

Continuing economic uncertainty and a further decline in tax collections prompted Governor C.L. “Butch” Otter to order an additional 3 -percent state budget holdback today. He directed state agencies to further reduce their spending in light of forecasts showing the 1-percent holdback that he ordered in September still would leave this year’s revenue significantly short of what was projected last winter.

'None of us know with certainty where the bottom of this downturn will be. But we have a responsibility to act prudently with taxpayers’ dollars, and a constitutional requirement to balance the state budget. This is a necessary step.'
–Gov. C.L. 'Butch' Otter

“This is precisely why I asked state agencies in September to hold an additional 11⁄2 percent of their appropriated General Fund budgets in reserve – on top of the 1-percent holdback. And it’s why I now am directing them once again to hold 2 percent of their General Fund budgets in reserve on top of the additional 3-percent holdback I’m ordering today,” Governor Otter said.

“These are difficult decisions made in consultation with legislative leaders and based on the best economic information available at this point in time. None of us know with certainty where the bottom of this downturn will be. But we have a responsibility to act prudently with taxpayers’ dollars, and a constitutional requirement to balance the state budget. This is a necessary step.”

A table accompanying this release details how much each state agency must reduce its spending under the 3-percent holdback, as well as the total spending reductions after the 1-percent and 3-percent holdbacks. State agencies have until noon on Monday, (Dec. 8), to finalize their specific holdback plans.

In addition, the Governor today directed all state agencies to begin preparing immediately for reductions in budget proposals they already have submitted for Fiscal 2010, which begins next July 1. He said those plans should be consistent with the 4-percent reduction in spending already ordered for the current budget year, plus the additional 2 percent that agencies are being directed to hold in reserve for the balance of Fiscal 2009.

“I encourage you to meet this new challenge head on, to be aggressive in assessing what is reasonably achievable and to keep the best interests of the people we serve first and foremost in your mind,” the Governor wrote in a memo to agency directors and administrators.

“Do not limit yourself to what has been done before; circumstances demand fresh approaches and a willingness to change and adapt to these difficult times. Being good and accountable stewards of public resources requires nothing less than our best efforts.”

Senator Dean Cameron of Rupert and Representative Maxine Bell of Jerome, co-chairs of the Legislature’s budget-setting Joint Finance-Appropriations Committee, endorsed today’s announcement.

“I fully support the Governor’s action. It’s important that we make the tough decisions now to address this problem immediately as well as over the longer term,” Senator Cameron said. “The Governor is doing everything he can to minimize the holdback while preparing for the possibility of even more difficult times ahead. I will continue working closely with him to ensure taxpayer dollars and essential state services are protected.”

“This step reflects state government’s commitment to being responsible stewards of the people’s money,” Representative Bell said. “The Governor’s courageous action now sets a prudent course for the Legislature and will help us avoid more serious problems later in the fiscal year.”