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National Economy Cited In Smaller Revenue Forecast

WAMC/Pat Bradley

Two economists advising Governor Peter Shumlin and Vermont lawmakers say a national economic downturn in the first quarter of this year is likely to blame for softer-than-expected state revenues.

Economists Jeff Carr and Tom Kavet say general economic conditions have hurt Vermont's collections of its personal income and sales-and-use taxes. The result is a downward revision in the forecast for revenue growth for the just-started fiscal year from 4.8 percent to 3 percent.

Shumlin is responding by asking state agencies to recommend cuts in their budgets averaging 4 percent. He says the overall revenue forecast is down about 2 percent, but he wants certain expenditures shielded from cuts.

Those include the state's debt repayments, support for public employee pensions and the general fund transfer to the education fund.

Copyright 2014 The Associated Press. All rights reserved.