Saturday, May 10, 2008

It's not surprising that the latest state revenue estimates have come in lower than previously expected, but this hardly makes it easier to contend with the situation. Here's the heart of Steve Peoples's report today:

Until yesterday, Governor Carcieri had officially anticipated a budget deficit of $384 million for the fiscal year that begins in July. He had already submitted a plan to close the massive gap, which accounts for 11 percent of state spending.

A group of budget analysts, however, determined yesterday that weak tax collections — led by declining sales-tax revenues — caused the state’s financial hole to grow by between $50 million and $55 million. ....

The election-year debate over the midyear spending plan raged for much of the last month. But it might pale in comparison to the debate over how to close a budget hole nearly three times larger for the coming fiscal year. That question will consume Smith Hill for the next seven weeks.