The 2013 legislative session is still more than three months away but the debates are already taking shape.

Budget hearings began this week with Lt. Gov. Tate Reeves taking to Twitter saying he hopes "agencies comes with ideas on how to save money, not a wish list of how to spend more" and Speaker of the House Philip Gunn agreeing - also on Twitter- with an emphatic, "Yes!" It seems both Republican-led chambers will be holding the state purse strings tight as the taxpayers and taxspenders both continue to slug through a weak economy that in Mississippi may have moved back into recession.

Two major issues potentially impacting the budget are Medicaid expansion and public employee pensions.

Medicaid expansion under the Affordable Care Act - frequently called "ObamaCare" - is projected to add an additional 400,000 Mississippians to the Medicaid rolls. Under the current plan, the federal government would pay 100 percent of the cost for three years and then reduce its share down to 90 percent by 2020. According to Gov. Phil Bryant, the total cost to the Mississippi budget over 7 years would exceed $1.6 billion. Additionally, Bryant says even during the initial three years of full federal funding, the increased administrative cost to the state of a larger Medicaid program would reach $81 million. Bryant opposes expansion.

Medicaid expansion could reignite the fight between Republicans and the Mississippi Hospital Association that raged during former Gov. Haley Barbour's second term over a $90 million assessment/tax to fund the program. Barbour prevailed over the MHA and its allies Speaker Billy McCoy and the Democratic led House of Representatives.

During the next round of elections, MHA played heavily in the fight for the House of Representatives. According to the National Institute on Money in State Politics, MHA contributed $32,000 to Republican House candidates in 2011 and $106,750 to Democratic candidates. Republicans took the House and new Speaker Gunn, along with Lieutenant Governor Reeves, opposes Medicaid expansion. MHA supports expansion.

I doubt MHA could line up enough votes to override a gubernatorial veto were they able to push through expansion over the objections legislative leadership. Because Medicaid must be reauthorized in 2013, Bryant could also use the threat Barbour kept on the table during his fights with MHA: no reauthorization and instead running Medicaid by executive order through the Office of the Governor.

If Medicaid isn't a large enough issue, the circulation of a one-page brief among legislators and lobbyists earlier this year regarding the status of the Public Employees' Retirement System (PERS) could rekindle another past battle that erupted during the 2011 elections following Barbour's appointment of a study commission to recommend PERS reforms. The brief claims that PERS is 53.5 percent funded and receives an average return of 5.4 percent over 10 years while assuming an 8 percent return. Without reforms, the program will not be able to keep the promises made to state employees.

This week's budget hearings brought a warning of a "silver tsunami" with one-third of state workers eligible to retire within five years. House Republicans fearing political fallout in 2011 boxed out many potential reforms by pledging not "in any way to change, alter or amend, in whole or in part, the arrangement current retirees and current employees have with PERS." Other reforms recommended by Barbour's commission could be considered as well as ideas being enacted in other states by Republicans and Democrats alike.

Education reform remains a priority for Republicans for the 2013 legislative session. Last session, school ratings were changed to reflect an A-F grading scale. The release of those ratings this year show need for education reform, according to the Mississippi Center for Public Policy, a nonpartisan think-tank which argues "Parents, not government, are responsible for the education and upbringing of their children." The group has been a leading voice in the call for public charter schools.

MCPP criticized the methods by the Mississippi Department of Education in grading schools. MDE omitted graduation rates from this year's school grades. "The result was predictable: We have the illusion of significant improvement over last year instead of the minimal improvement that would be seen with an accurate comparison. If graduation and college readiness is the real measure of success, the majority of our districts are failing," MCPP President Forest Thigpen stated in an update from his organization. MCPP noted that MDE continues to refuse to implement the school rating system it adopted in 2009 to better compare Mississippi schools to schools in other states.

Education reform issues from MCPP include "charter schools, third grade reading intervention, vouchers for special need students, and modifying the state's accountability model to be more fair and transparent." I suspect Republican leaders in the legislature will consider those and other education reforms.

For those tired of national politics, it won't be long till state issues heat up again.



Brian Perry is a partner with Capstone Public Affairs, LLC and a columnist for the Madison County Journal. Reach him at reasonablyright@brianperry.ms or @CapstonePerry on Twitter.