September 2002

We have operated the last year on the assumption that we would see a recovery in the third quarter, and I believe midsummer we were beginning to position ourselves as an economy for that recovery.

Reporters (in order of appearance):

KEN VERDOIA, KUED
SCOTT MILLER, KBZN
DAN BAMMES, KUER
DONNA SPANGLER, DESERET NEWS

Transcript:

KEN VERDOIA, KUED: Governor, thanks for joining us today. Utah has undergone several budget revisions dealing with the slumping national economy, keeping a hopeful eye of course on the horizon for things to get better. But now many of the scenarios that are offered for the national economy are dim at this point, and they're all tempered increasingly by prospects of war with Iraq. What are your economic advisors telling you about the status of Utah right now, and what are the prospects for Utah needing to revisit the state budget yet again in advance of the legislative session?

GOVERNOR LEAVITT: All very good questions. We have operated the last year on the assumption that we would see a recovery in the third quarter, and I believe midsummer we were beginning to position ourselves as an economy for that recovery. It has, however, been disrupted, and the disruption has come from the corporate governance difficulties that we have seen, and the cleansing fire that literally is burning through our economy right now, and the lack of confidence that that has provided, both on Wall Street and among the investment community.

My advisors tell me that that will likely mean several, potentially several more quarters--we don't know if that's one or two or five, but some number--where we will not see a sustained recovery for a period. So we are beginning to reformulate our thoughts based on new assumptions. It's a dynamic economy, and I remain optimistic that in the long term the economy in this state will be good, that we'll continue to see growth and prosperity. We are working through a period, however, that will require us to be very careful in the way we navigate in selection of priorities. We still have long-term aspirations, we still have a very clear vision, we still want the state to become a capital for high-tech employment, investment, and entrepreneurship. We still see the best way to achieve that as being through investment in human capital. That means that education will be the highest priority of funding, and when we do continue to revisit our budget over and over--and we do it constantly--I'm watching the receipts on our revenues virtually every week to make certain that we're meeting our expectations.

The economy in Utah is, I would say flat, but we have, we're positioned, I believe, for recovery whenever the national economy is prepared to offer it. In the meantime we'll deal with what we're, with the hand we're dealt, so to speak.

KEN VERDOIA, KUED: Will there be the need to tighten the belt one more notch before January?

GOVERNOR LEAVITT: There is not, at this moment, an apparent need for that. But we're watching it literally on a week-to-week basis, and we do have contingency plans in place. I've asked agencies, for example, to take certain financial precautions involving expenditures to protect us in the case of a down turn in the second quarter or third quarter of our fiscal year. We're managing it carefully, and I feel, consistent with the way we've done it in the past, we'll be just fine. It's not a period where we're able to make a lot of new investments, and the ones that we do make have to be chosen carefully.

SCOTT MILLER, KBZN: Governor, we heard some disturbing statistics yesterday about child care in Utah, and the forecast for the next ten years is not good. One of the things we also heard was that state could qualify for as much as $15 million in federal grant, but right now there's just not enough to get the matching funds from the state. Do you see that as a possibility to look at and say, "Hey, let's do something about child care"?

GOVERNOR LEAVITT: Those are dilemmas that every state faces currently. We're among them and doing our best to balance them. It begins, it's an attractive idea to be able to put a dollar up and get a few dollars back from the federal government. On the other hand, we still have to come up with the matching dollars, and typically that means taking it out of Medicaid or out of education. And that's not an attractive option either. So I don't offer, Scott, any magic, simply doing the best we can to find the best way to optimize our dollars.

KEN VERDOIA, KUED: What about the prospects that were kind of contained in that report, that there is a role for the state. Child care is generally considered a private sector industry which is regulated by the state for the well-being of the children. What role do you see for the state to address this, what they're identifying as a critical shortfall in child day care?

GOVERNOR LEAVITT: I think the state does have a role. It's a fairly well-defined role. First, we need to assure that there is a means to license and to monitor the quality of child care that's going on in our communities. Second, I think it's reasonable for us to be working to expand the availability, not necessarily by sponsoring it ourselves, but by helping other people find ways to get into that business in a way that will serve the demand, and then lastly, there are situations when we're helping people through their own difficult circumstances in our TANIF programs or in our temporary transition programs to help pay for some child care.

Now there's an almost, I don't know if it's unlimited, but it's a very large number of people who would appreciate help with child care, and for whom state assistance would be valuable. But again, as we discussed earlier, there's a limit to the amount of money that we're able to devote to that thing in specific, when we're also trying to keep people insured so they have health care benefits, trying to assure that children are well educated, and to keep our social structure intact. And I think we're doing a good job of finding that balance.

DAN BAMMES, KUER: Governor, when Vice President Dick Cheney was here you appeared at a fund raiser with John Swallow, and told this group of Republican faithful that the voters in Salt Lake County would have to go only 41 percent Republican to give John Swallow a win in the second district. It would appear that with redistricting, the strategies in the first and the third districts would be similar. Should the voters in Salt Lake County feel as though they've been disenfranchised by this political strategy that basically the way they vote in these congressional districts doesn't matter very much?

GOVERNOR LEAVITT: I think I'd disagree with the premise of the question. When I have run in three state-wide elections, I have only succeeded in getting a majority of the votes in Salt Lake County one time, the second time I ran. The other two times, other candidates won Salt Lake County. It's a matter, not something I'm happy about, but it nevertheless is a fact. And therefore a lot of votes to elect a Republican like me, or a Republican like Senator Bennett or Senator Hatch, in state-wide elections, the votes come from other areas other than Salt Lake County. It's not unusual for a metropolitan area to have demographics like that. So I don't see it as unusual at all. Nor does- - It just lays out what the hurdle- - You might put it a different way, if you were looking at it from Jim Matheson's point of view, and just turn it around. So that's just a matter of math, not a matter of partisanship, or for that matter, analysis.

DAN BAMMES, KUER: As a matter of campaign strategy, do you perceive the candidates like Jim Matheson are focusing their campaigns outside Salt Lake County, because what happens in Salt Lake County is less important?

GOVERNOR LEAVITT: Well, again I would argue that that's not true. You cannot win an election in this state without doing reasonably well in Salt Lake County. If you're running for a state-wide election, if you fall far below 45 percent, you're likely not to win. Now that means that if you're a Democrat candidate, if you can get greater than 45 percent, those are votes that ultimately you're not going to have to put as part of your support base somewhere else. So it's- - The goal in an election is to get 50 percent plus one vote, and where those votes come from is what candidates think about in their campaign, strategize to determine where they'll use their time and how they'll best apply their resources.

KEN VERDOIA, KUED: If you were a candidate this year--you're not, you're interested in the well-being of your party--but if you were a candidate running this year, what would you identify as the central issues for the voting public? What matters the most in your eyes?

GOVERNOR LEAVITT: Well, with respect to the congress, which is what we've been talking about, it's pretty clear to me that the control of congress, who controls congress is going to be the most significant vote that anyone casts. If the Democrat party controls the United States Senate and the House of Representatives, that's an entirely different government than if the Republican party controls the government. And so I think that ultimately is going to boil down to the central issue of the congressional campaigns.

DONNA SPANGLER, DESERET NEWS: Governor, on the November ballot is an initiative to raise the tax on low-level radioactive waste. What is your viewpoint on that? I mean what- - Do you agree or support that, or- -

GOVERNOR LEAVITT: I have not expressed a point of view publicly, and I likely won't do it today. I do have feelings about it, but the campaign is just beginning, and I think I'll wait to comment on that later.

KEN VERDOIA, KUED: Are you surprised at the amount of money that's pouring into both sides on this campaign?

GOVERNOR LEAVITT: No, I'm not. It's a- - I think that there are dynamics that surround it that invite that, and I do think that it will be an interesting race. I think it's one in which voters are going to have to sort some facts out, because it's a very confusing, very confusing proposition. And it contains, the best I can tell, over 100 changes to state law. That's almost as many as you'd do in an entire legislative session. And I think this is an extraordinary amount of work for any thoughtful voter to sort through, but I'll have perhaps more to say about that later.

DAN BAMMES, KUER: Governor, the backers of this initiative won a court battle to get it on the ballot, that essentially invalidated the current state law on initiative petitions. Do you see a restructuring of that law, and will you- - How do you see the whole issue generally of making law by initiative petitions? Not popular in Utah.

GOVERNOR LEAVITT: Initiatives have their place, and we need an initiative process to have a well-balanced and well-checked democracy. I felt that the Supreme Court ruling was well over the top. I struggle with the reasoning, or at least the extent to which they carried their reasoning. I think it did open, in fact, what might be considered a flood gate for what could be less than desirable public policy, based on some populous notions around which there is someone willing to put a lot of resources to carry the day in a populous way.

That's why we have a representative democracy. And in keeping with that, it seems to me that the initiative process has to have some legitimate representative component to it. We have an electoral college in America. It protects small states in a very important way. Were it not for the electoral college in America, twelve cities would have the capacity to literally elect presidents and control the entire electoral process of the United States. But our founding fathers very wisely created a system that balanced population and geography, small states, large states, and the various interests. And I think our process of initiatives needs to have the same type of wisdom applied to it. And my sense is, at least my reading of the impacts of the Supreme Court ruling, is that they have essentially invited, and I think required, the legislature to rethink the way we create those checks and balances.

SCOTT MILLER, KBZN: Governor, last week you were in Washington, D.C. with some of your gubernatorial colleagues talking about homeland security and talking about a coalition of five to eight states that would share responsibility of communications, law enforcement, and emergency services in times of sudden disaster. Utah, you say, has a very good chance of being one of those states. Talk a little bit about that and what the plan is.

GOVERNOR LEAVITT: This is an effort that the national governors have asked that I chair, and it would pick a group of states, somewhere between 5 and 8, and likely a couple of large cities, and begin a process of integrating and creating interoperability--two big words--between states. But what that means is police departments and fire departments and health departments need to be able to talk with each other within a state, but they also need to be able to talk with each other and exchange information between states and between the states and the national government. This is a project, really, in terms of complexity, that's somewhere in the neighborhood of the interstate highway system. And it's not going to happen overnight, it's going to take some time. But this is a very aggressive timetable we're working on, and I'm doing it working closely with the White House to make certain that it's in conformity with the national strategy.

I'm persuaded that homeland security is really home town security, and that the national government will not have the capacity to arm our nation to external threats, to fight wars on foreign soil and battle to protect our borders, and be able to, at the same time, protect us internally. The forces, if you will, in homeland security will be 700,000 local law enforcement police, firefighters, health departments, literally hundreds of thousands of people that need to be coordinated, and have plans and common language and a sense of integration. That's a brand new phenomenon in America. And it will drive vast changes in, not just the way we work interactively with government, it could literally reshape the nature of government. What is the role of the federal government? What is the role of the state government? Where does the local government fit in? All of those things are now being discussed in ways that are powerful enough that it literally could approximate a shift in balance generally.

KEN VERDOIA, KUED: Listening to that description, some people sitting at home might seem surprised that there would be a need to create better integration between states, assuming that such relationships are easily addressed. What you seem to be indicating is that there is no relationship in this regard, and that one needs to be created.

GOVERNOR LEAVITT: You've stated it perfectly. There is no relationship. Every state basically has its own system, the federal government has its own. There's no place, in my experience, that has less integration between departments than the federal government. We have created a kind of silo government, where one department doesn't necessarily function interactively with the other, and the truth is, there's not much means by which, not many means by which that can happen. There's no money allocated ever to interoperability between departments. So we're exploring some, and pioneering some new areas, frankly. It's a demanding assignment, and one that I'm pleased to be helping with.

Our experience as a state during the Olympics, is I'm confident, why I was asked to do this, because we had a five-year period where we worked hard to create that kind of interoperability. And we made it work here. We were sharing intelligence, we were working between federal state and local agencies. We're having a conference in the latter part of October where we'll have leaders of law enforcement at the federal level and the state and the local levels from all over the country come to ask this question, "What can we learn from the winter Olympics and how can we apply it to homeland security and other areas?" And so it has, as surprising as it may be, there's not a whole lot of interoperability between states or even within departments in most states.

DAN BAMMES, KUER: Governor, what happens next with Legacy Highway? You're kind of stopped in your tracks at this point.

GOVERNOR LEAVITT: I think it would be valuable to remind ourselves why we refer to it as the Legacy Parkway. The legacy isn't a highway. Legacy is the impact of our generation, meeting our responsibility to the next to solve some very difficult problems that will most surely come if we don't act. It's about being able to create a vision of high-quality communities, where, that matches the vision that we created in Envision Utah, where literally tens of thousands of Utahans participated in the creation of a vision. So this is a short-term setback.

I've instructed the department to work through the problems that the court pointed out, and to fix them. We're placing a high priority on saving the contract that we had with the contractor, that we felt was a very good contract, as did they. We're trying to get the costs down between now and the time we're able to start construction to essentially zero, and making progress on all of those fronts.

Life requires patience, and when you're dealing with the legacy of a generation on the entire western part of the most populous area of our state then it requires patience, and we'll show that patience and just move forward.

DONNA SPANGLER, DESERET NEWS: Governor, what do you think went wrong with the whole process? I mean Legacy certainly, Legacy Highway had such tremendous support when it was first announced, and it seemed to be moving quite well, and then all of the sudden these legal battles showed up. So- -

GOVERNOR LEAVITT: It's just that what we, it's just how we have to operate when we're in a free society with the capacity for minority points of view to be respected. And there are lots of the things the court said that I agree with. The court affirmed the fact that we need a project, affirmed the fact that we were planning it in a proper way. They didn't affirm a couple of specific areas related to, "Did we think about wildlife enough? Did we think about a specific corridor enough?" And we'll go back and make certain that we've met that standard.

There's probably never been a highway built in this state that didn't go through this same kind of experience. I-80 we all take for granted now. Frankly that was the legacy of a past generation to us. We drive on it today freely, but it was the subject of bitter, difficult, costly litigation for literally years, that there are still bad feelings over among certain quarters. And yet we drive on it every day, taking it for granted. The legacy, the word "legacy" really connotes in my mind that it's a generation's obligation to prepare for the next one. And when we talk about it as a legacy, we're not talking about it as a highway, we're talking about the capacity literally to plan and to unlock the entire western corridors along the Wasatch front that literally go from north to south, and it's the only place our population can go. So I see this as a much bigger vision, and it's not simply about a local dispute. It's not about a lawsuit, it's about a vision for the future.

KEN VERDOIA, KUED: Governor, separate and clearly distinct from the radioactive waste tax initiative on the ballot in November, is the issue of the placement, potential for temporary storage of high-level nuclear waste rods in Utah. This past week there's been a flurry of media reports about the exploration of a so-called plan B. If the Nuclear Regulatory Commission gives approval to the temporary storage, should Utah move in with its own location and seize the opportunity to gain financial advantage? I know you've been quick to put those in their place, but your response to this notion, should we have a plan B?

GOVERNOR LEAVITT: First of all, I don't think a plan exists. There's been a small group that have penciled in on the back of an envelope a notion that something could happen, and if someone were inclined to do that they would be years from being able to make a serious proposal. And frankly, I think it is naive and hypocritical if we were to pursue such a plan.

We don't want nuclear waste here. It isn't a matter of the money, it's a matter of the safety. This is not a financial issue, it is a public safety issue. And it's an issue of fairness. We've been battling this for some nine years, my position has not changed. We oppose it, and will oppose it with plan A, plan B, plan C, or plan D. It's not coming here if we can have any influence on that process.

KEN VERDOIA, KUED: You have worked aggressively to maintain a solid front of opposition to the radioactive waste storage process. Does this undermine the solid nature of that state opposition to know and to send the signal out that there are people behind the scenes that would wish to gain the benefits?

GOVERNOR LEAVITT: Well, again, I don't see this as really a serious discussion. The only thing that has occurred is that there's been some flurry of media activity basically building on itself. There was one article, and then everybody reported on the article, and then everybody reported on the reporting on the article. There's no proposal, there's no serious engineering that has or could be done, no one owns a site. I mean this is just, this is a flurry of nothing. It doesn't exist, and won't have any impact on this debate.

KEN VERDOIA, KUED: Well, on that note we are out of time for this monthly edition of the news conference with Governor Michael Leavitt in the studios of KUED in Salt Lake City. We do want to invite to join us online for a transcript of this and every edition of the Governor's News Conference courtesy of the Utah Education Network. It's available at www.uen.org. Until next time, thanks forjoining us, and good night.

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