Nearly half the states will start 2003 with a new governor, but the freshmen – and re-elected incumbents, too – are taking control at a time when their states are facing the most dire financial prospects in a half-century.

At least 23 new governors – possibly 24, depending on final results in Alabama – won election this year, the most since the National Governors Assn. began tracking in 1982.

Though term limits forced out many incumbents, voters were clearly in a mood for change. Parties in power were ousted in 16 of the 20 races for open seats.

Now, the men and women elected have to act, and the options promise to be painful.

“It’s the worst fiscal situation since the Second World War,” said Ray Scheppach, executive director of the NGA. Stopgap measures taken over the last two years sharply limit choices before the new governors, he said.

“They’ve done the easy and even the moderately difficult cuts,” along with fee increases and taxes on cigarettes, Scheppach said. “From here on, you’re going to be cutting into real programs that are going to have effects on people.”

Voters chose new faces in nearly two of every three races on Tuesday.

Term limits forced 14 sitting governors out of office, while six chose not to run. Voters ousted three other incumbents, and possibly a fourth – Alabama Gov. Don Siegelman has been fighting to reverse what appears to be a narrow loss, and his request for a recount was rejected Friday.

Reality check

Many of the candidates campaigned on promises that they could guide their states through a minefield of weakening revenues and rising health care costs without raising taxes.

Before the election, others attempted to minimize the pain, or at least the perception of fiscal problems.

Ohio Gov. Bob Taft refused to talk before the election about potential deficits, despite his opponent’s accusation that the state would be short $4 billion next year.

Two days after winning re-election, Taft, a Republican, acknowledged a future problem. “There will be a deficit,” he said. He said it was too early to estimate how big.

In South Carolina, Democratic Gov. Jim Hodges refused to cut budgets after an economic advisory board predicted a shortfall, and delayed government agencies submission of budget requests until after the election, later than usual.

The Republican who beat him, former Rep. Mark Sanford, said he was under no illusions about the task before him and said the economic woes were probably the worst since the late 1940s.

“It’s a budget year of blood, sweat and tears that is going to be the first challenge to my administration,” Sanford said Friday. Tax increases would be a last resort, he said, adding that there were ways to make government run more efficiently.

That same cautious optimism could be heard in many states.

Hawaii Gov.-elect Linda Lingle, the state’s first woman and first Republican governor in 40 years, called for a wholesale audit of state government. “I could walk in today and find millions of dollars right off the top without ever getting into a program or the delivery of service to the public,” she said.

Shortfalls all around

But the economic prospects are far from bright. Last year saw some $50 billion in shortfalls to state budgets, and the latest estimates project another $57 billion in the current year, Scheppach said.

With the national economy still sputtering, and anecdotal reports that many states are already seeing a return of last year’s severe revenue weakness, good financial news seems far off for state planners.

In the weeks before the election, most pollsters and analysts said there was a clear link between the weak performance of incumbents and the budget problems worrying the states.

“The budget swamp is a treacherous place for state politicians to be wading around in,” said Ron Faucheux, editor of Campaigns & Elections, a magazine for politicians. “In gubernatorial politics, when times are tough economically and revenues are falling, that’s where they are – the budget swamp.”

Ideas abound

Still, governors-elect are flush with ideas. Though many focused in the first postelection days on transitions, others spoke out about their plans:

• Oklahoma Gov.-elect Brad Henry, a Democrat, promoted a lottery to raise $300 million for education. “I am dead set on getting this done,” he said.
• New Hampshire Gov.-elect Craig Benson, a Republican, said he and other New England governors would seek federal funds for transportation, infrastructure and special education. “We’ll be banging that drum loudly,” he said.
• Oregon Gov.-elect Ted Kulongoski, a Democrat, said the state must rein in the cost of Oregon’s retirement system for public workers.