Gov. Steve Beshear warned Tuesday the state’s budget outlook is a whole lot worse than expected — with projected revenues falling a minimum of $1.4 billion lacking meeting obligations throughout the 2010-12 period.Citing “a challenge much more than many have anticipated,” the governor said in a news conference he will have to consider cuts even going to his main concern — school funding — and reducing state workers.
He said their state must find a method to raise revenue, though he eliminated proposing any “broad-based tax increase.”
He explained he’s still thinking about raising revenue via a bill to legalize video lottery terminals at race tracks, with revenue going both towards the state and also to help the horse industry.
“We’re working on it,” he explained when asked if he's the votes within the General Assembly to pass through a slots bill. “… If folks actually want to help the horse industry and also to give us money to resolve this budget problem, they ought to prefer the VLT legislation.”
Senate President David Williams, R-Burkesville, said in a news conference later within the day that Beshear was exaggerating the issue to gain support for that gambling bill.
“He’s been a one-issue governor up to this juncture,” he explained. “That’s all he’s had on his mind: establish one crisis to another that was unmanageable should you didn’t have gambling revenue.”
Two weeks ago the Legislative Research Commission’s Office of Budget Review released more conservative figures for that estimated budget needs within the next two fiscal years, starting July 1, 2010.
When those numbers are when compared to official revenue estimates for the following biennium, the state falls about $888 million short.
Williams said his budget staff created similar numbers.
“We will have to work together about this particular situation,” he explained. “I just don’t accept the (governor’s) figures.”
Assumptions questioned
Rep. Rick Rand, the Bedford Democrat who's chairman of the House budget committee, said the administration’s estimates include “more detailed assumptions” compared to LRC’s.“They are saying there’s more required for debt service than we thought may be needed, and they’re assuming a lot more will be required for Medicaid,” he explained.Beshear said exactly the same at his news conference, noting the more conservative estimates fail “to consider an array of rising costs for example debt service and Medicaid obligations — obligations we can't avoid.”
Adding payments on bonds already authorized and projected Medicaid must current spending levels, Beshear estimated how big the budget shortfall at $556.Two million in 2010-11 and $890.Two million in 2011-12.
That puts the entire shortage at $1.446 billion over 2 yrs.
Williams, however, said the administration could steer clear of the added debt service by not issuing bonds on projects the legislature has authorized.
“The governor will have to look at those types of things” he said.
Beshear said their own estimate is conservative since it does not include any rise in state retirement system contributions or funding to assist the Teachers Retirement System purchase health insurance.
Nor, he explained, does it cover increased medical health insurance costs for state workers and teachers, money to spread out new courthouses scheduled to become completed in the following two years, or increases within the prison population.
Beyond that, it doesn't provide money to improve education funding or purchase raises for teachers assuring workers, Beshear said.
The governor warned that cuts to balance your budget could be much more painful compared to those that he and also the legislature have made 5 times since the beginning of 2008. The cuts to date, he said, have preserved basic educational funding, vital health programs and public safety.
But preserving those priority areas means just 15 % of the budget has endured almost all of the spending cuts chose to make this year. Beshear stressed how hard it will likely be to cut those lower-priority agencies again.
“Many of those agencies will be to the point where any extra significant cuts may cause the removal of vital services and personnel,” he explained.
No comments:
Post a Comment