Posted by Terry Alexander - email
RICHMOND, VA (WWBT) - Federal stimulus money will help state leaders fill in a budget shortfall that grew by another $822 million.
Gov. Tim Kaine said Monday that the federal stimulus package signed into law Tuesday guarantees at least $1 billion in money for Virginia. That means there's a net gain of more than $200 million.
The stimulus package allocates a big chunk of money for Medicaid, and a smaller amount for general expenses.
Still, the federal dollars don't do anything to wipe Virginia's original problems off the books.
Kaine says the Commonwealth's budget shortfall is still $2.7 billion. His secratary of finance, Richard Brown, says all major sources of revenue are running below expectations.
"Our estimate now is that we'll probably be in the negative all the way through the end of the fiscal year," Brown said.
It means major cuts, like the ones already announced for education and healthcare, are still planned. And there's no guarantee that this won't be the last time the numbers worsen.
"We had to cut to a pretty dramatic level and we ought to stay at that level as we watch what happens in the economy over the next couple of months," said Kaine.
Kaine says money for things like highway spending, education, and tax relief have yet to be figured out. He still expects lawmakers to pass a budget by the end of the month.