THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Wednesday, January 24, 1996 TAG: 9601240011
SECTION: FRONT PAGE: A10 EDITION: FINAL
TYPE: Editorial
LENGTH: Short : 45 lines
Gov. George F. Allen's budget for the next two years relies too heavily on optimistic assumptions about revenue sources that may not be reliable.
The budget originally gambled, for instance, on $67 million a year becoming available as a result of new lottery games - Powerball and Keno. But critics of gambling include key Allen supporters, and their objections induced him to drop the idea. Now the governor has to figure out how to replace the lottery revenue he was counting on. In gambling parlance, he was betting on the come.
Another $95 million is supposed to come from a settlement with Trigon Insurance, but it's not yet a done deal. And even if an agreement is struck, legal complications could delay payment for a year or even two. Yet so far as the Allen budget is concerned, the money is as good as spent.
The governor counts on surplus-property sales for $72.5 million more, yet it was reported Sunday that the Allen administration has found land and buildings worth at most $36 million to sell.
These and other gimmicks add up to at least $344 million of the $34.6 billion two-year budget. Admittedly, that's only about 1 percent of projected revenues, but the governor has little room for error. There's a real and justified demand for more spending for education than his budget proposes. At the same time, a softening economy and weak Christmas sales last month could mean shortfalls in state sales and income-tax revenues.
For that reason alone, the fact that 1 percent of the state budget may be funded with fool's gold is cause for concern. It's particularly troubling that a governor who has demanded fiscal responsibility should resort to the rosy-scenario school of accounting in planning the state's future.
By law, state budgets must balance. But beyond that, budgeting should also be conservative and reliable. Supposing you'll spend less than likely and counting on more money in revenues than is plausible is the kind of happy-go-lucky, something-will-turn-up bookkeeping that the Republican Party used to scorn. by CNB