How to Create a Budget Crisis (part II)
Back last November, we told you how to go about creating a budget crisis.
They projected a $456 million shortfall, that today looks like a $191 million shortfall.
We told you how that $191 million is covered if the Governor made the $147 million in cuts he promised back in December, because the tax hikes from this session will increase state revenues by $52 million.
We've explained how State Budget Director Mary Lassiter has suggested that these promised cuts were not made, and that the Governor is planning to show us April's revenue numbers and tell us that they're unexpectedly low, despite the fact we should all expect them to be low, just as we should expect May's revenues to rebound.
In fact, where the state might legitimately face a $46 million shortfall in FY 2010, the Governor is likely to claim a shortfall above $500 million, largely because he has failed to cut spending like he promised and he plans on using the worst numbers he can find.
We'll show you the math in a little bit. Here's the proof that our predictions are materializing from the Herald Leader:
FRANKFORT - Gov. Steve Beshear and his budget team huddled behind closed doors Thursday morning in the Capitol with legislative leaders to discuss the state's financial picture.
The administration is bracing for a budget shortfall in the new fiscal year that begins July 1, but so far has not indicated its amount.
Beshear has scheduled a 1 p.m. news conference in the Capitol to release internal revenue projections for current and upcoming fiscal years.
He also will provide an update on cautionary measures involving swine flu.
Beshear has said he might ask a group of independent economists known as the Consensus Forecasting Group to provide revenue projections for the next fiscal year.
He also has said a special legislative session might be needed to deal with a major shortfall.
The administration has not yet offered any specific remedies. Some people are talking about the prospects of casino gambling in Kentucky.
This year's legislative session had to address a nearly half-billion budget shortfall for this fiscal year. Taxes were raised on tobacco products and alcoholic beverages and various cuts were implemented.
Beshear and lawmakers started their meeting Thursday at 10:18 a.m. in room 110 of the Capitol.
The group included Mary Lassiter and John Hicks from the budget office, Cabinet Secretary Larry Hayes and Transportation Secretary Joe Prather.