Sun, May 27, 2018 05:02 AM
Wednesday, March 8, 2017 issue
State revenue request made

State Budget Director, Bradford L. Cowgill, today made a formal request for an updated official projection of revenue for the fiscal year ending June 30, 2004.  The request sets the stage for a budget reduction order by Governor Fletcher before the end of December. Since taking office on December 9th, Governor Fletcher has implemented a real hiring freeze, continued restrictions on travel, worked to streamline state government and asked his cabinet secretaries to evaluate all probationary employees.

"We have inherited a budget crisis that has developed over the years and are doing what's necessary to balance the budget without raising taxes.  We will continue to work to find more efficiency and productivity in state government," said Governor Fletcher.

The requested official projection will authorize Governor Fletcher to recapture appropriations to the various agencies of government and to transfer funds from various state government accounts into the General Fund for use in maintaining government operations.

"Governor Fletcher intends to act immediately and decisively to solve the state's fiscal crisis," Cowgill said.  "The first step in this process is to address the $304 million current year problem.  To move forward we must have an official revision of the revenue estimate," stated Cowgill.

In addition to the anticipated recaptures and transfers, Governor Fletcher has asked the secretaries of the soon-to-be consolidated cabinets to develop plans to achieve efficiency savings, from operational expenses - not programmatic, of not less than 2.5% of their current year budgets. "These efficiency savings are needed to reduce the severity of the fiscal crisis in the next fiscal year," Cowgill said.

Cowgill's request for an official revenue projection was addressed to the Consensus Forecasting Group which rendered a preliminary projection on October 10th.

That preliminary projection showed that the General Fund will be $262.4 million short of appropriated revenues in the enacted budget. An additional $41.7 million of estimated revenue and expenditure issues bring the total budget problem for the current fiscal year to $304.1 million.  This amount represents approximately 4.1% of the General Fund budget for the current year.

The Consensus Forecasting Group met on December 11th, but did not produce a revised estimate.  Cowgill stated that he has requested that the Group respond to his request not later than December 24 and that he expects the Group's official estimate to be at or near the preliminary projection, which it rendered on October 10th.

"The Commonwealth cannot afford to continue to spend more than it takes in each year.  We must take immediate, responsible action to reduce spending and balance the budget in the current year to live within projected revenues," said Cowgill.

Governor Fletcher must introduce a balanced budget recommendation to the General Assembly for Fiscal Years 2004 - 2006 by January 27, 2004.  Cowgill commented: "We have to solve the current year before we can make our recommendations for the next two years." 

Part of that solution to financial problems of future years is to curb spending immediately and to re-evaluate ongoing spending practices that will lead to economies beginning now, but with greater impacts in the next several years. 

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