Story glum about state's budget picture

by Sarah R. Buchholz, Chronicle staff

ainting a somber picture of the commonwealth's budget situation, state Rep. Ellen Story (D-Amherst) told the Faculty Senate last week that the outlook is unlikely to improve without new taxes.

     "As you can imagine, I don't have any good news to tell you," she said at the Dec. 5 meeting.

     Citing budget shortfall projections ranging from $1.5 billion to more than $2 billion, Story said, "Nobody knows, of course, and we will have to wait and see what the exact figures are, but it's going to be truly miserable for this year and probably next year and maybe the year after that.

     "One of the peculiar reasons why it's so bad here is because, over the last 12 years, ... we have given 42 tax cuts. And that was too many. This is not just the fact that the stock market crashed or that Sept. 11 happened - those things did not help - but there is a structural deficit in the budget."

     Story said that despite a 7 percent reduction in the state payroll in the past 18 months, the commonwealth is in such need of income that she fears the Legislature will consider legalizing casino gambling or securitizing its tobacco-settlement money, a move which would mean trading access to cash in the short run for a much larger sum expected over the long term.

     Story said that in the face of such a shortfall, increasing the state's income is necessary.

     "If we raise the sales tax here by one penny, that at one whack brings in $750 million in new revenues," she said. "It's the biggest chunk of money that you can get at one time, and it's one penny on the sales tax, so I think that again is going to have to be seriously considered, and I would guess that our personal income taxes will also rise as well.

     "That will be tough, because the governor-elect will veto them, so that means we can't just have a simple majority in the legislature, we have to have two-thirds in both houses, and that will be difficult to do unless both the speaker [of the House of Representatives] and the president [of the Senate] are twisting arms, and that may well happen."