The Sky’s Not Falling! The Sky’s Not Falling!

Virginia’s budget is in better shape than lawmakers thought back in August when Gov. Timothy M. Kaine announced that the commonwealth had a $641 million General Fund shortfall to close in the current fiscal year (Fiscal 2008). A combination of new budget estimates, administrative cost cutting and savings identified by the General Assembly could allow the state to end the year, which ends June 30, with a small surplus.

Since Kaine announced his alarming findings, “later reviews and estimates put the gap around $429 million, thanks in part to lower costs for programs like Medicaid and higher than anticipated revenue for the Virginia Lottery,” reports Garren Shipley at the Northern Virginia Daily, citing a recent House Appropriations Committee report.

Meanwhile, Kaine has ordered more than $300 million in administrative cuts this year, and House appropriators have identified roughly $375 million more in savings and cuts. Potentially, the General Fund could end the fiscal year with as much as $219 million to spare, Shipley writes.

In Fiscal 2009, this year’s budget reductions and modest revenue growth should bring the General Fund to within $50 million to $150 million of balancing — even when a $1.1 billion Standards of Quality re-benchmarking is thrown into the mix. By fiscal 2010, the state should return to its normal pattern of budget surpluses.

(You can view the House Appropriations Committee report here.)

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3 responses to “The Sky’s Not Falling! The Sky’s Not Falling!”

  1. Anonymous Avatar

    Ah Jim if only it were so simple

    The 500 Pound Guerilla is the Pre-K initative. It will be interesting to see Kaines political skills in action to get this initative funded


  2. Anonymous Avatar

    Thank God the Governor cut all that abstinence education funding. Surely that would have sent the Commonwealth into fiscal ruin.

  3. Larry Gross Avatar
    Larry Gross

    I’m no cheerleader for Kaine. I had serious doubts that he was made of the similar stuff as Warner so I wasn’t expecting too much.

    My expectations have been exceeded. I don’t think he’s done such a bad job despite what strikes me as wishful thinking from some in the BR peanut gallery. 🙂

    One big difference between him and Gilmore…. he seems to know when to … not take a “my way or the highway” attitude …

    So.. what I’m expecting on the Pre-K in a principled advocacy and a pull-back or even a punt if the budget cannot support it – unlike Mr. Gilmore who, in my mind, was almost reckless in his zeal to cut the car tax.

    In my mind, when Gilmore left office, he could still claim fiscal conservatism but not fiscal responsibility.

    It’ll be interesting to see him run on his record.

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