82.1 F
Charlotte Amalie
Friday, May 27, 2022
HomeNewsArchivesMILLS: REVENUES AND APPROPRIATIONS MUST MATCH

MILLS: REVENUES AND APPROPRIATIONS MUST MATCH

Ira Mills, director of the Office of Management and Budget, said Wednesday that balancing the budget means the Legislature must not approve appropriations for which there is no funding source.
Mills testified before the Finance Committee with Finance Commissioner Bernice Turnbull and Internal Revenue Director Claudette Farrington to address projected revenues.
Mills said revenue from individual income taxes is expected to inch upward in fiscal year 2000 from $198 million to $200 million. But trade and excise taxes are expected to go down by $2.2 million.
Contributions to the General Fund had been revised downward, he said, to reflect an estimated reduction in the sale of delinquent property taxes from $27 million to $21.9 million due to the 60-day amnesty period.
Under questioning by Sen. Donald "Ducks" Cole, Mills took a moment to chastise senators, saying that year after year a balanced budget was presented but then, "throughout the year we add appropriations without identifying additional resources to cover those appropriations and then we say the budget is out of balance."
Mills also implored the senators to approve lump-sum payments to the executive branch departments.
"Given the scarcity of resources and the resulting tightness of the proposed expenditure plans, it is absolutely imperative that department heads be given maximum flexibility in managing their limited resources during the coming fiscal year if they are to deliver services within the proposed funding constraints," Mills said.
Mills said lump-sum appropriations are the trend in municipal budgeting because this approach shifts the focus of legislative oversight responsibility to programs and away from line-item budgeting.
He said nearly 90 percent of state governments use lump-sum budgeting.
Mills pointed to several capital projects — the Christiansted boardwalk, South Shore Road, the Ritz Carlton expansion and Carifest — as ways to jump-start the economy.
Farrington's comparison of FY 1999 and 1998 revealed that while individual income taxes were up, corporate income was down, as were gross receipts taxes.
Turnbull said that of $44 million in real property tax bills sent out for fiscal year 1998, about half has been collected. She said she expected revenues to come in for fiscal year 2000 at about the same rate as 1999.
"However," she said, "being able to reduce our level of expenditures, that is where the challenge lies."
Turnbull said the territory cannot expect to operate at the same level as it has in the past. Departments cannot continue to overspend their allotments and appropriations, she added.
Turnbull reminded senators that the community was asking the federal government for concessions and in turn the federal government had expectations of reduced expenditures.
"If we fail to rise to the challenge, they could come in and take over the running of our affairs," she said. "I am sure none of us want that to happen."
The Finance commissioner characterized the FY 2000 budget and the reorganization plan as less than perfect documents but said, "I see them as the first step in a plan to bring this government's expenditures in line with its revenues."

Print Friendly, PDF & Email
Keeping our community informed is our top priority.
If you have a news tip to share, please call or text us at 340-228-8784.




Support local + independent journalism in the U.S. Virgin Islands

Unlike many news organizations, we haven't put up a paywall – we want to keep our journalism as accessible as we can. Our independent journalism costs time, money and hard work to keep you informed, but we do it because we believe that it matters. We know that informed communities are empowered ones. If you appreciate our reporting and want to help make our future more secure, please consider donating.

STAY CONNECTED

20,771FansLike
4,726FollowersFollow

FROM FACEBOOK

Comments Box SVG iconsUsed for the like, share, comment, and reaction icons
Load more
Ira Mills, director of the Office of Management and Budget, said Wednesday that balancing the budget means the Legislature must not approve appropriations for which there is no funding source.
Mills testified before the Finance Committee with Finance Commissioner Bernice Turnbull and Internal Revenue Director Claudette Farrington to address projected revenues.
Mills said revenue from individual income taxes is expected to inch upward in fiscal year 2000 from $198 million to $200 million. But trade and excise taxes are expected to go down by $2.2 million.
Contributions to the General Fund had been revised downward, he said, to reflect an estimated reduction in the sale of delinquent property taxes from $27 million to $21.9 million due to the 60-day amnesty period.
Under questioning by Sen. Donald "Ducks" Cole, Mills took a moment to chastise senators, saying that year after year a balanced budget was presented but then, "throughout the year we add appropriations without identifying additional resources to cover those appropriations and then we say the budget is out of balance."
Mills also implored the senators to approve lump-sum payments to the executive branch departments.
"Given the scarcity of resources and the resulting tightness of the proposed expenditure plans, it is absolutely imperative that department heads be given maximum flexibility in managing their limited resources during the coming fiscal year if they are to deliver services within the proposed funding constraints," Mills said.
Mills said lump-sum appropriations are the trend in municipal budgeting because this approach shifts the focus of legislative oversight responsibility to programs and away from line-item budgeting.
He said nearly 90 percent of state governments use lump-sum budgeting.
Mills pointed to several capital projects -- the Christiansted boardwalk, South Shore Road, the Ritz Carlton expansion and Carifest -- as ways to jump-start the economy.
Farrington's comparison of FY 1999 and 1998 revealed that while individual income taxes were up, corporate income was down, as were gross receipts taxes.
Turnbull said that of $44 million in real property tax bills sent out for fiscal year 1998, about half has been collected. She said she expected revenues to come in for fiscal year 2000 at about the same rate as 1999.
"However," she said, "being able to reduce our level of expenditures, that is where the challenge lies."
Turnbull said the territory cannot expect to operate at the same level as it has in the past. Departments cannot continue to overspend their allotments and appropriations, she added.
Turnbull reminded senators that the community was asking the federal government for concessions and in turn the federal government had expectations of reduced expenditures.
"If we fail to rise to the challenge, they could come in and take over the running of our affairs," she said. "I am sure none of us want that to happen."
The Finance commissioner characterized the FY 2000 budget and the reorganization plan as less than perfect documents but said, "I see them as the first step in a plan to bring this government's expenditures in line with its revenues."