Virginia Faces Shortfall
The news in yesterday's Washington Post is that Virginia is now facing a $300 million shortfall for the upcoming budget year. The reason is largely the slumping housing market in Northern Virginia which has a "ripple effect" in state and local revenues.
These cycles happen in a modern-day economy. Some years are good, some are not. To prepare for the lean years, the state maintains a "rainy day" fund to meet its obligations. This is a process as old as Biblical times, when Joseph counseled Pharoah to store his surplus grain for a famine. In contrast, the Federal government simply prints more money in slow times, thereby increasing its annual budget deficit.
The state shortfall would be ordinary news, except for the fact that the 2007 General Assembly passed a major bill which relies on "future surpluses" to supply the state's share of increased transportation dollars.
This is the same Assembly which made million-dollar inheritances tax free in 2006, thereby lopping off another $100 million in annual revenue (and significantly skewing the equity of our tax system).
Now we are facing a deficit.
I could write my opinion on all this -- but I think the facts speak for themselves.
Just want to doublecheck you are still in the gas tax camp right which would make gas about say what $3.30 or so
just wanted to doublecheck
Your opinion is that all taxes should remain in place, and increased each year so govt. stays nice and comfy.
Here is the real answer to the budget shortfall... Who set 6.5% as the target, and they should get the bill for everything over and above the 3.5% that will be collected.
I don't know Senators Chichester and Potts address, but I believe that is where the bill should be forwarded.
Meanwhile, we should forward a case of SlimFast shakes to STD.
Thanks for the comments. I was in court this a.m. so just catching up. NovaMid, you know where I stand. Guess I'm cursed with being the candidate in the 34th SenDist that doesn't change positions based on the latest news (or poll). STD, you raise a legit point -- if the projected growth rate was 6.5% (as you say), then that's very over-optimistic, at least around here. I have been representing people for months who have been bailing out of the RE market because of the downturn (which started at least 18 months ago). No surprise that revenues are down.
Have a great weekend!
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