Legislative committee approves $28 million in budget cuts

08/18/09 5:50PM By Bob Kinzel

AP Photo/Toby Talbot
(Host) The Legislature's Joint Fiscal Committee has approved a plan to reduce the new state budget by roughly 28 million dollars.

The cuts are needed because of a recent downward revision of state revenues for the 2010 fiscal year.

Most of the reductions are achieved by using surplus money from last year and by transferring federal stimulus funds to state programs.

The package includes a 7.4 million dollar reduction in state labor costs but it doesn't specify how to reach that target.

It will be up to the Douglas Administration and the Vermont State Employees Association to agree on a plan - otherwise the Administration says as many as 250 additional state employees could lose their jobs next month.

During the 2009 fiscal year, lawmakers were forced to implement several rounds of budget cuts.  Governor Jim Douglas says it's too soon to tell if more cuts will be needed in the coming months:

(Douglas) "The state economists who met with the Emergency Board at this table about a month ago said that most of the risk is still on the down side. Even when the economy begins to pick up, it takes a while for state revenues to recover...I think we're going to see unemployment continue to rise for nearly another year and state revenues lagging those indicators. So I think it's possible that we might not have seen the bottom."

(Host)  The budget reduction package also transfers almost 2 million dollars in adult education expenses from the General Fund over to the Education Fund.

Some lawmakers are concerned that the transfer will have to be financed by higher property taxes.

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