The commonwealth’s economy is among the country’s best despite projections that the state could soon face a budget deficit, Virginia Gov. Tim Kaine said.
“In the national economy, Virginia is a leader,” the governor said Tuesday on his monthly WTOP radio appearance. “We have one of the lowest unemployment rates and have one of the highest per-capita incomes. We are dealing with a deficit, but other governors are, too. We’re watching the national economic indicators very closely. We’re going to be a front-of-the-pack state, but whatever the national economy does, it is going to affect us.”
Through April, Virginia’s revenues grew 3.6 percent, according to a May 11 report from Secretary of Finance Jody Wagner. That level of growth is well below the 6.5 percent General Assembly members expected when they approved the $73.8 billion biennial state operating budget. If the trend continues, revenues for the fiscal year ending June 30 would be about $300 million below expectations.
Kaine has ordered state agencies to conserve unused appropriations but does not expect major money-saving moves, such as closing agency offices, will be necessary. He warned, however, that Virginia’s budget deficit could worsen and carry into the fiscal year starting July 1 if the country’s economy slumps.
“This is Living Within Your Means 101,” Kaine said of the current deficit projections. “This is not an emergency. If it stays at this level, the cost-cutting will not be felt by the public. If the national economy worsens, who knows?”
