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State Budget, Tax Revenues and Tax FairnessThe state’s November Economic Forecast revealed a $5.5 billion deficit for the upcoming budget biennium, when inflation is included. The state’s economist, Tom Stinson, has warned that this number is likely to grow following the February 2009 Forecast — quite possibly by another $1-2 billion.
In addition to the next biennium, another $426 million must be cut from the current budget to balance the books. The Governor’s unallotment plan was announced recently in order to deal with the current budget shortfall.
More than a decade of tax rebates and tax cuts during good times, and the “no-new-(state)-taxes” resolve of the last six years, have left our communities and our economy in worse shape than they have been in decades. Recent budget deficits have all but drained our reserves, making use of fund reserves a very distant option.
Shrinking revenues come while the needs of the state are increasing. Investments in several basic programs have not kept up with the needs: public schools, transportation and other public works, early childhood programs, job training and higher education and health care.
Because Catholic Charities values both the individual and the common good, we must ensure that needs for food, shelter, health care and physical safety are met. We also must ensure that the state has the resources it needs to meet the social, educational and infrastructure costs necessary to create a healthy state.
Legislative Direction:
- As the state faces this current economic crisis and budget shortfall, we believe that taxes should be on the table as one of many options
- Any new taxes or tax structure should be based on the ability to pay, simplicity and political accountability
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