Budget writers revise state spending plans

By Shelia Byrd/The Associated Press

JACKSON, Miss. (AP) — Mississippi budget writers have revised the state’s spending plans slightly upward after receiving an economist’s report of continued recovery from the recession.

The Joint Legislative Budget Committee on Tuesday approved a recommendation to increase the current fiscal year budget by $6.5 million to $4.53 billion. The committee raised the budget for next fiscal year, which begins July 1, to $4.6 billion. That’s an increase of $14.4 million over the initial estimate.

Lawmakers use the budget estimates to determine funding for state government. House Speaker Billy McCoy, a Democrat from Rienzi, says the increase for next fiscal year means more money could be allocated for various programs, including education and mental health.

Legislators have less than a month left in the 2011 session to craft a spending plan for next fiscal year.

Senate Appropriations Committee Chairman Doug Davis, a Republican from Hernando, voted against the revision. Davis questioned whether the revenue collections could meet or exceed monthly estimates for the rest of the current fiscal year.

“We’ve only hit that number three times this year. That’s a little disturbing to me,” Davis said. “I just didn’t have enough evidence before me to justify any increase at this time.”

State Economist Darrin Webb cited a downward trend in unemployment claims, an upward trend in retail sales and increased consumer spending. Still, Webb said the recommended increase is conservative.

“However, we will not soon return to the strong growth of the past. We appear to be in an environment in which growth will be well below historical averages for quite some time,” Webb said.

Legislators questioned Webb about how rising gasoline prices and the catastrophe in Japan could impact the state’s economy. Webb said it’s too early to speculate about the impact of the devastation that’s occurred in Japan since last week’s tsunami.

He said while gas prices “take a toll on Mississippi households,” he didn’t think the spike would be long-term.

“In my opinion, fuel prices will begin to diminish. Much of what’s driving it has more to do with the uncertainty in the Middle East. As things look normal, fuel prices will go down,” Webb said.