JACKSON – Gov. Haley Barbour met with House and Senate leaders Wednesday to show how his state budget proposal would look with added federal stimulus funds.
The Legislature recessed the 2009 session earlier this month until it had more details on how federal stimulus funds could be used to replace budget shortfalls caused by declining state tax collections.
Because of the economic downturn, the state is expected to take in less revenue this year than last, forcing budget cuts.
The federal stimulus funds can be used to offset some of those cuts, particularly in education and health care.
“The preliminary figures I shared with the legislative leadership today are based on a least-change model that would make the fewest and smallest cuts for departments and agencies allowed under the stimulus rules as we understand them,” Barbour said. “I cautioned the leadership that these calculations are still subject to approval by the federal government in certain areas.”
Barbour said his budget proposal also is based on revenue generated by a 42-cent increase in the cigarette tax to 60 cents per pack and on a $90 million tax on hospitals.
The House leadership has proposed increasing the 18-cent-per-pack cigarette tax to 75 cents and a $45 million tax on hospitals. The Senate leadership has proposed an increase to 64 cents per pack.
In the past, Senate leadership has voiced support for the $90 million hospital tax.
In a statement, Speaker Billy McCoy, D-Rienzi, said, “The legislative bodies can compromise. I don’t know about the governor. I’ve often said, ‘it’s Haley’s way or the highway.'”
Barbour also voiced support again for an additional tax on cigarette companies that did not participate in the settlement of the state lawsuit with the tobacco companies in the 1990s.
He also backs taxing smokeless tobacco by container instead of a percentage of the retail cost of the product.
Both proposals would generate more revenue for the state.
Bobby Harrison/Daily Journal