Reply to Hogan vetoes kirwin tax increases

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[quote=Anonymous][quote=Anonymous][quote=Anonymous]

If you think there is a choice, where, praytell, do you intend to get the money for creating such a program?  It's really easy to make a choice but how do you plan to pay for it?  The state no longer has reserves, they've spent that on pandemic response.  The state is going to have significantly decreased income next year.  [b]Where do you plan to get the money to pay for this program when every agency and department will be taking cuts to their annual budget to account for the revenue shortfall?
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It's all well and fine to say we've made a choice, but the choice was made by the circumstances.  You can't create an expensive program when you have no money to pay for it.  [/quote]

That's why the Kirwan bill, which Hogan vetoed, explicitly stated that if state revenues drop by 7.5% in a given year, the Kirwan plans would be put on hold and increases to education spending would be limited to the rate of inflation.

I.e., the General Assembly passed a bill that says no Kirwan when there's a budget shortfall, and then Hogan vetoed it on grounds that...there's a budget shortfall.

The reality is that he would have vetoed it even if state revenue had been projected to double next year. He was always going to veto it, regardless.[/quote]

The state budget is approximately $44B.  By that measure, if the state revenue fell by $2.5B (or about 6% of the budget), that we would have to pay out $4B annually for the Kirwan recommendations.  Frankly at this point, virtually all of the states cash reserves are gone to pay for the pandemic response, UI, and additional costs.  If the state revenues dip below the current year at all, then the state cannot afford the Kirwan recommendations.  Assuming the state revenue stays the same, the only way to implement the Kirwan recommendations is to cut $4B or 9% of the total state budget from other departments and agencies.  If the state revenue drops between 7.4% then the other departments of the state could be forced to cut their budgets up to an additional $3.25B or up to $7.25B per year.

The Kirwan commission recommendations can be put on hold until the state returns to solvency and has cash reserves built up again.  After we have recovered economically, it can be put back on the table for consideration, but to try to pass it now, when we are financially unstable and insecure, it is foolish to pass a law that would require the state to spend that kind of money even at a revenue loss of up to 7.5%.  I'm always astounded that so many high income earners are so fiscally irresponsible.  [/quote]

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