He said revenue from corporate taxes were “over-performing,” but noted the decline in sales tax revenue was worrying.
Secretary Zogby said agencies have already cut 6 percent of their administrative spending working toward a goal of 10 percent by the end of this fiscal year, primarily by reducing staff by 1,811 positions and through other cost control measures.
The Unemployment Compensation reform enacted earlier this year, he said, will result in the state saving more than $380 million and employers over $150 million annually.Secretary Zogby said agencies were instructed to submit FY 2013-14 proposed budgets which held General Fund appropriations flat and to not backfill any cuts in federal funds with General Fund dollars.
The impact of this requested funding level, he said, is to reduce General Fund appropriations by another 7 to 8 percent due to increased personnel costs.
Secretary Zogby said the cost drivers for the next budget, no surprise, are public welfare-- $650 million and pension costs-- $511 million: $403 million for school employees and $108 million for state employees.
He said it was “probably likely” there will be no layoffs to meet next year’s budget requirements, but noted some agencies are in a better position than others to meet additional cuts.
Secretary Zogby said, unlike other years, there are no rainy-day funds and no real reserves to plug budget holes next year.
A copy of the mid-year budget briefing is available online.
