Virginia is tracking to meet or beat revenue projections as the end of the fiscal year nears but much of the extra money is already spoken for as the state works to pay down some debt.Here's the problem with calling this a "surplus:" It's the result of defaulting on contractual obligations to fully-fund the Virginia public retirement system. That's like saying you have extra money in your pocket because you refused to pay your bills.
Finance Secretary Ric Brown said Monday that the state could end up bringing in $100 million to $200 million in unanticipated revenue - all depending on the past 10 days of June collections.
June is the last month of the 2011 fiscal year.
The potential accounting windfall is a pittance compared to the state's overall budget, and legislators portend that the next two-year budget will be lean as revenues grow slowly.
The state is forecasted to collect $14.7 billion and needs to collect another $1.4 billion in June to meet that projection. Last year the state took in $1.6 billion in June, Brown said.
"We're obviously in good shape for a surplus," he told legislators during a House Appropriations Committee meeting. - Leesburg Today
To Leesburg Today's credit, this point is made quite effectively as the article continues:
But any extra dollars will disappear in the state's underfunded pension system and to repay a federal loan among other debt and transfers required by law.Nice work by Leesburg Today to observe that the surplus Mr. Brown is projecting is not, in fact, a surplus of any kind. We're getting lucky in having a bit higher revenue than projected, but the fiscal awfulness in Richmond remains.
For example, a portion of the money will go into the state's rainy day fund and to a water quality improvement fund. Little would remain to pay for operations or programs, Brown said.
Virginia also owes $8.9 million in interest to the federal government for money the state borrowed to pay unemployment benefits, he said.