Once again looking at state revenues that fell below expectations in September, Gov. Timothy M. Kaine said Tuesday that “austere” is the word to describe the two-year budget he will prepare for his successor.
Kaine said he didn’t want the next governor, regardless of whether it’s Democrat Creigh Deeds or Republican Bob McDonnell, “to have to put a budget team together and then start scrambling the first day” of his term to adjust a deficit.
“The right thing for me to do, on my way out the door, is to make as many of the tough decisions as I can” about the budget for 2011 and 2012, said Kaine, whose term ends Jan. 16.
“It really does look like this budget is going to be a very austere one,” Kaine said during a Cabinet Community Day visit to Lynchburg.
Four cuts have been made already in the current two-year budget. About 600 layoffs of state employees have been announced, plus one-day furloughs for many other workers.
Kaine said it’s possible more cuts will be necessary in December for the current budget, which runs until June 30. Decisions on whether to make those cuts won’t start taking shape until late November, he said.
“I have a team that is second to none, and they are very practiced” at cutting budgets, Kaine said.
Prospects for an economic recovery to boost state revenues aren’t on the horizon yet, Kaine said.
“We are seeing some good signs, but there are no trends yet that we really could take into account” for building the 2011-12 two-year budget, Kaine said.
If positive trends were to emerge, they would show up first in taxes on home sales next spring, and in an uptick of retail sales, Kaine said.
Income taxes would be the slowest sector to improve, because unemployment usually is the last economic factor to turn around from a recession, he said.
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