Virginia Gov. Charles S. Robb said today that he will impose between $50 million and $75 million in spending cutbacks starting July 1 in order to balance a state budget threatened by the nationwide recession.
The reductions, prompted by a new projected shortfall in state revenues, will be made across the board in virtually every agency of state government -- with the exception of education and welfare programs exempted by the governor, state officials said later. Agency heads will be given maximum flexibility in paring back such items as travel, supplies, contracts, filling personnel vacancies and other operating expenses items, the officials said.
"We'll be experiencing some pain in state government," said Wayne Anderson, secretary of administration and finance. "In some cases, it will mean less direct services to the public."
The reductions represent the first time that any Virginia executive has had to slash appropriated spending since Republican Gov. Mills E. Godwin imposed a controversial 5 percent cutback in 1975. In that case, as in this one, the cutbacks were forced by a recessionary economy that threw state budget forecasts out of balance.
Robb said at a press conference today that the newest revenue forecasts are "probably on the low side" and it is still possible the state's $6.6 billion annual budget would remain balanced without the cutbacks. "But we'd prefer to be safe rather than sorry and be in the situation of some of other states," the governor said.
In fact, state officials said later, they made a conscious decision to adopt the lowest of three new revenue projections offered by Chase Econometrics, the nationwide economic forecasting firm, in estimating the shortfall of $50 million to $75 million.
Earlier this year, the state had relied on a 12.1 percent projected growth in revenues in preparing its budget for the fiscal year starting in July. That forecast assumed an economic recovery that has yet to materialize. State officials, citing continued high unemployment and sagging income and sales tax receipts, said they decided to be overly cautious by adopting Chase's "low growth" forecast of only 10.1 percent in revenue growth.
The governor's announcement was applauded by key legislators today, who praised him for moving immediately to curb expenditures. "I commend the governor for being on top of this thing so early," said Sen. Adelard L. (Abe) Brault of Fairfax, a member of the Senate Finance Committee.
Brault and several others said they are anxious to see what cuts are imposed. Details of the cuts could be revealed as early as Friday when Robb aides are scheduled to brief the committee.