Wednesday, April 8, 2009

Latest Numbers: State Revenues Decline Further, Governor Should Veto Tax Cuts

In light of the continued decline in state revenues, the Georgia Budget and Policy Institute calls on Governor Perdue to continue his promise of fiscal responsibility and veto bills passed by the General Assembly that siphon dollars from the fiscal year 2010 budget, placing it into a deficit.

The FY 2009 collections through March are running 1.2 percentage points behind what the budget projects - a 8.0% revenue decline from FY 2008 total collections instead of a 6.8% revenue decline. If this decline maintains through the end of the year (April through June), the FY 2009 revenue shortfall will be at least $225 million.

Georgia has approximately $550 million in the Revenue Shortfall Reserve that automatically covers the shortfall this year, however this leaves little wiggle-room for the FY 2010 budget starting in July.

"Governor Perdue has been a good and reliable steward of Georgia's budget," said Alan Essig, GBPI's executive director. "He is the last chance Georgia has to prevent worsening the impending deficit."

A deficit is acutely relevant in light of so-called stimulus legislation the governor has on his desk. According to the official fiscal notes on House Bill 261 and HB 481, if these bills are signed into law they will cost the state treasury approximately $60 million in FY 2010, as well as hundreds of millions of dollars in FY 2011 and FY 2012.

"These bills devote millions of dollars to activity that will occur regardless of government intervention. They will also keep millions of dollars from important services that won't be offered to Georgians who need them, such as meals on wheels and care for Georgians with developmental disabilities, and to services that make our state strong, like the education system," said Sarah Beth Gehl, deputy director of GBPI.

Georgia Front Page
Fayette Front Page
Follow us on Twitter: @GAFrontPage

No comments: