03.27.09: Tax Cuts and Expenditure Increases Not Triggered
By David Walrath
As part of the February State Budget agreement, income tax increases would be reduced ($1.8 billion less state tax revenue) and some social service and health care programs would have some budget cuts restored ($947.7 million) IF the state could use $10 billion or more of the new federal stimulus funds to offset state General Fund costs.
The Treasurer and Director of Finance had to agree by April 1 that $10 billion or more would be available for this purposes. The Treasurer and Director have concluded that there is not $10 billion or more in new federal funds that can offset state General Fund costs. Consequently, the income tax increase will not be reduced and expenditure cuts will not be restored.
