Saturday, October 11, 2003

Ky. budget outlook brightens



By Charles Wolfe
The Associated Press

FRANKFORT - Economists who issue the state's official revenue projections reduced their estimate Friday of a budget shortage in the current fiscal year.

As a result, and barring a change beforehand, Gov. Paul Patton would not be legally required to order a fresh round of spending cuts prior to leaving office Dec. 8.

The panel of economists - officially the Consensus Forecasting Group - calculated that the state's General Fund will take in about $262 million less than what is called for in the budget for the fiscal year that began July 1.

In August, the forecasting group thought the shortfall would be about $274 million. On Friday, the group made slightly modestly higher estimates of what the state is likely to take in from the sales tax and income taxes, both individual and corporate.

The new forecast is to be used for planning the budget for the next biennium - July 1, 2004, through June 30, 2006.

A follow-up forecast is to be issued in December or January. The General Assembly is required to use it in making the final, enacted budget. However, the governor or the legislature's leadership could call the forecasting group back into session for a new set of projections.

Under Kentucky law, forecasted shortfalls of a specified magnitude trigger a requirement for the governor to order spending cuts, which Patton has previously done.

Cuts first were made in administrative areas, acting state Budget Director Mary Lassiter said. Only later did Patton make programmatic cuts.

"This administration has gone to every effort possible to minimize service impacts," she said.




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