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HomeNewsArchivesBUDGET VS. FIVE-YEAR PLAN—LITTLE IN COMMON

BUDGET VS. FIVE-YEAR PLAN—LITTLE IN COMMON

As the Legislature prepares to consider Gov. Charles W. Turnbull's $429.6 million budget for Fiscal Year 2001, many of the people who worked last year on the government's Five-Year Economic Recovery Plan are shaking their heads in bewilderment.
In his transmittal letter to the Legislature, Turnbull said his budget proposal reflects much of the five-year plan, but some of its task force members don't think the two documents bear much resemblance.
The budget, said John deJongh Jr., president of the St. Thomas-St. John Chamber of Commerce and chairman of the task force, "is not addressing the five-year plan at all. It's a joke."
Another member of the private sector, Peter Ross, who represented the St. Croix Hotel Association, agreed. "It looks like it's at great variance with our study," he said. "We put a lot of time and a lot of effort into [the five-year plan] … and it's been pretty much ignored."
The governor's advisor for financial affairs, Rudolph Krigger, another task force member, said, "I really don't want to talk about that subject. All I would say is, a policy decision has been made in regards to the ingredients" of the budget.
With the five-year plan listing 200 recommendations—or "initiatives"—it is almost impossible for the 2001 budget not to contain some of them.
But to Ross and deJongh, the administration has missed the essentials.
The basic idea of the plan is stated several times within its text. For example:
"It is an operating premise that the Government cannot rely on tax increases as the sole and only means to achieve revenue growth, as such increases are counter-productive to attaining real economic growth. The cost of Government is too high relative to the revenues generated, and short-term solutions represented by tax increases will only deepen the financial dilemma. Instead, these problems require a basic restructuring of the way the Government does business to bring about lasting solutions."
In its most basic sense, the more than 400-page plan took a two-pronged approach to dealing with the government's deficit: cut government spending and promote private-sector growth. Although it recommended improvements in collections and a few fee increases, the task force concluded that raising taxes was short-sighted because that approach would only further weaken what is already a shaky private sector.
DeJongh sees "a lot of taxes and fee increases" in the budget.
Ross sees the budget "putting the burden back on the private sector again." While the administration picked up some of the recommendations for revenue enhancement, it neglected most of the initiatives for reducing expenditures.
"I think it was a heart and lung transplant," said Ross, "in which only the lungs went in."
Editor's note: This is the first in a series of articles examining the 2001 Budget Proposal in light of the proposed five-year plan.

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