“Borrowing Bob’s” surplus announcement ignores state’s true budget problems

ProgressVA today responded to Governor McDonnell’s announcement of a larger than anticipated end of year surplus, reminding Virginians that accounting gimmicks and conservative revenue projections won’t solve the state’s true fiscal problems.

“This ‘surplus’ is the result heavy borrowing, substantial cuts to services, federal stimulus, creative accounting, and not paying our bills,” said Anna Scholl, Executive Director of ProgressVA. “It’s time for long term solutions. It’s time for a balanced approach.”

“While we appreciate the governor’s attempt to boost his resume for a Vice Presidential bid, Virginia taxpayers deserve facts, not gimmicks. The truth is that Virginia faces an $800 million budget shortfall for the 2012 budget cycle, over $17B in unfunded liabilities for the state pension fund, and a quickly growing balance on the state’s credit card.”

Virginia is constitutionally bound to balance its budget. Revenue surpluses at the end of a biennial budget cycle are simply the result of tax collections out-­‐pacing conservative revenue projections. Furthermore, the majority of excess funds at the end of the budget cycle are already statutorily committed to a variety of programs, including the state’s rainy day fund and Chesapeake Bay cleanup, leaving few discretionary dollars to apply to underfunded programs.

ProgressVA supports a balanced approach to the state budget championed by the Better Choices for VA coalition that combines sensible cuts with increased revenue through closing wasteful tax loopholes, ending irresponsible corporate giveaways and modernizing our tax code.

Click here for a PDF version of the press release.

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