Another shortfall in Georgia budget expected

Revenue slump digs $1 billion-plus hole

ATLANTA --- Georgia legislators voted Thursday to take a two-week break as they scramble to fill what is shaping up to be another huge hole in the state's already slimmed-down budget.


With tax collections continuing to slide, legislators will take a break from passing bills in the House and the Senate so budget writers can address another $1 billion-plus budget shortfall.

Legislators said they were caught off guard by yet another dismal revenue report last month. There had been hopes that January would break a slump in tax collections. Instead, they dipped 8.7 percent, the 14th straight month of declines.

Some lawmakers grumbled the forecast for the fiscal year that begins July 1 could be even bleaker than expected.

"I think $1 billion may be on the low side," state Senate Majority Leader Chip Rogers said of the budget hole.

Gov. Sonny Perdue has proposed an $18.2 billion budget for the coming fiscal year. He projected 4 percent revenue growth, which some now say may be far too optimistic.

The governor balanced the budget by proposing a pair of unpopular proposals: a tax on hospitals and health plans and siphoning money from the state's environmental loan fund.

Together the two proposals are expected to bring in roughly $650 million. If legislators reject the proposals they either have to make cuts in that amount or find additional revenue to fill the hole.

Georgia is required by law to balance its budget.

In addition, federal stimulus dollars for Medicaid are set to dry up midway through the year. Unless Congress delivers additional money from Washington, that will be a hit of $380 million.

"We have a difficult, difficult budget task ahead of us," House Majority Leader Jerry Keen said.