In letters sent to the House and Senate education committee chairs and Health & Welfare committee chairs, the co-chairs of the Legislature's joint budget committee are warning that much bigger budget cuts than have been anticipated could have to be made in public schools and Medicaid. Public schools, for which Gov. Butch Otter proposed a flat budget next year, might have to take cuts of between $50 million and $81 million, the letters said, and Medicaid, for which Otter proposed $25.2 million in state funding cuts, might need to take $35 million to $50 million.

The warning letters came as JFAC is going over new assumptions for next year's budget that kicked off with last Friday's letter from the governor, the House speaker and the Senate president pro-tem warning of a budget hole for next year of up to $185 million, including the $35 million in cuts Otter already had proposed. That figure has fallen, however, because the House today unanimously passed legislation for IRS tax conformity that would cost the state just $20 million between this year and next year - not the $70 million anticipated last Friday. That bill is on a fast track and headed to the Senate.

Plus, January tax revenues came in $15 million ahead of projections, despite a big unanticipated payout for alternative energy sales tax rebates - suggesting the economy is doing better than anticipated. Still, based on what lawmakers know now, they're anticipating that including Otter's proposed $35 million in cuts for next year's budget, the Joint Finance-Appropriations Committee could have to slice $137.9 million. That would mean either a 4 percent additional cut on top of Otter's already-proposed cuts; or if they're all rolled together, a 5.34 percent cut in the state budget as a whole.

"This is the landscape as we know it," JFAC Co-Chair Rep. Maxine Bell, R-Jerome, told the joint committee today. Said Co-Chair Sen. Dean Cameron, R-Rupert, "This will be a moving target. ... We're asking you just to be informed, start trying to be prepared, start trying to get your mind around the depth of the problem we're facing."

Sen. Nicole LeFavour, D-Boise, said the magnitude of the problem warrants JFAC and the House Revenue & Taxation Committee holding a joint hearing, to include possible new revenues in the budget discussion. "Is there no forum for calling meetings with them and for trying to coordinate in some sensible way, so that we don't create a crisis before we're certain to have one?" she asked. Bell responded, "I don't feel we're creating a crisis, I feel we're looking at reality. In the end the arithmetic wins." Said Cameron, "This is the painful, stark reality of what this committee gets to do."