Wednesday, December 19, 2001

Remember 9-11-01

Terrorist attacks slow
Gov’s budget planning

By Richard Borreca

The terrorist attacks in New York and Washington and the resulting economic downturn have forced the Cayetano administration to delay preparing the annual state budget.

Gov. Ben Cayetano is telling lawmakers that the budget, usually delivered to lawmakers one month before the legislative session opens, now will not be ready until just two days before the session convenes on Jan. 16.

Cayetano told legislators last week that the budget he is preparing will include "identifying restrictions to the FY02 (the current fiscal year) operating budget and reductions to the FY03 budget," he said.

"These efforts will require additional time for review," Cayetano said.

Previously, the governor has said he was considering cutting the budget to include other items, such as a $1 billion construction program that has been rejected by the Legislature.

In his latest message to lawmakers, Cayetano said he was considering "necessary funding increases in critical program areas," but did not spell out what state programs he wants to increase.

The delay in submitting the budget was caused by Cayetano asking the state's Council on Revenues for a new estimate on state tax collections after the Sept. 11 attacks.

The council reduced the state revenues projections and is now predicting that the collections will actually shrink by 0.7 percent, or about $158 million, compared to last year.

The council projects how much money the state will collect in taxes. The administration uses the projections to prepare a budget.

Cayetano told the legislators that the revised figures "necessitated major changes in our development of the executive budget -- in order to provide for the critical programs and to fulfill legal mandates for a balanced budget."

According to state law, "not fewer than 30 days before the Legislature convenes ... the governor may submit a supplemental budget."

That isn't possible this year, he said.

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