(Host) Governor Jim Douglas says the state should make additional cuts in this year’s budget to help close a new $14 million shortfall in tax revenues.
The Douglas Administration says the unexpected drop in revenues is the result of sluggish holiday sales and a growing number of job layoffs.
Speaking at a Statehouse press conference, Douglas says it’s a mistake to raise taxes to close part of the budget gap because he doesn’t think the current recession is going to end anytime soon:
(Douglas) "I think we’re going to be here for awhile to be perfectly honest I think this is a downturn that’s quite profound that is going to make a significant difference in our state and the lives of many people across the country for several years so we’ve got to make some decisions that put our state’s spending on a sustainable track."
(Host) Douglas says he’s backing additional budget cuts because he believes that all Vermonters need to make sacrifices to help the state get through its current financial crisis.
The governor was asked what sacrifices wealthier Vermonters are making, since he’s ruled out raising the state income tax:
(Douglas) "We have a number of Vermonters as I’m sure you know who receive a lot of their compensation from investment portfolios and I think it’s pretty obvious that many of them are not enjoying the level of income that they have in the past. So I think people in the upper income scales in Vermont are going to see a lot less of that income in this current economic climate."
(Host) In 1991, Governor Richard Snelling proposed a package of program cuts and tax increases to help eliminate a state budget deficit.
Douglas says he doesn’t favor that approach at this time, because tax burdens in Vermont have increased significantly over the past 18 years.