- Bolling applauds Kaine's efforts to reduce state spending, but expresses opposition to tax increases and calls for reforming the budget process- RICHMOND - Earlier today, Governor Timothy M. Kaine released his proposed amendments to the 2008/2010 state budget. In response to the Governor's action, Lieutenant Governor Bill Bolling issued the following statement:
"These are challenging economic times for Virginia. Because of a slowing economy and the Kaine administration's failure to include reasonable revenue projections in their 2008 budget recommendations, Virginia faces a financial shortfall of some $3B, if not more. It is important for us to close this budget shortfall and restore fiscal integrity to Virginia's state government and we are prepared to do that.
"I applaud Governor Kaine for his commitment to reduce state spending. The spending reductions that the Governor has recommended and the spending reductions that the General Assembly must make are not easy. However, when the economy is not growing government must do what families and businesses must do - we must tighten our belts, prioritize spending and live within our means. This is the only responsible way to bring the budget into balance.
"Earlier this year I voluntarily reduced my office budget by 8.8% to help address the budget shortfall. Additionally, I returned 5% of my budget to the state treasury in 2007 to mitigate the effects of the previous budget deficit.
"However, I am very concerned by the Governor's proposal to increase taxes by $167M. Throughout this process the Governor has repeatedly promised to balance the budget through spending cuts, not tax increases; and it is very disappointing to see him renege on this promise. The people of Virginia expect their leaders to keep their word, not break their promises.
"I am also concerned that the Governor's tax increases could have a devastating impact on tobacco industry jobs in Southside and the Richmond area. Given the overall economic slow down, these businesses are already suffering enough, and now is not the time to place additional tax burdens on their shoulders.
"I also continue to be concerned that the Governor is basing the budget on overly optimistic revenue projections in the 2009/2010 fiscal year. At a time when the economy is struggling and state tax collections are declining, the Governor continues to estimate that we will see economic growth of 4% in the upcoming fiscal year. If we fail to meet these revenue projections, we could face additional budget shortfalls next year. A more prudent course would be to assume little or no revenue growth in the upcoming fiscal year and adjust state spending accordingly.
"To prevent these dramatic shortfalls, provide more accurate revenue projections and solve these problems in the future, we need to pursue real budget reform and increased transparency in the budget process. I look forward to working with the Governor and the members of the General Assembly to address these concerns, restore fiscal integrity to the budgeting process in Richmond and adopt budget amendments that put our state back on a sound fiscal foundation."