Dear|LNAME|,
The status quo won a victory yesterday in Dover when the majority party apparently decided to punt on a constitutional amendment that would lessen the impact of boom and bust budget cycles.
The “budget smoothing” amendment would use a more sophisticated multiyear financial model in estimating tax revenues.
Instead of the rainy-day fund reserve that preserves the state’s blue-chip bond rating, a tax stabilization fund would be employed in socking away money for lean times. It’s probably what your mom and dad did when there was a little money left over.
The panel that came up with the constitutional amendment also recommended changes in the tax code to broaden the revenue base.
Many Democrats were uncomfortable with the measure, despite an impressive list of co-sponsors from both parties.
You have to credit Rep. John Kowalko, perhaps the most liberal member of the General Assembly, for being honest.
The Newark Democrat attacked the measure as a sop to the business community, which strongly supports the amendment.
Kowalko continues to push for a proposal that adds income tax brackets for those pulling down six figures, an unremarkable income level by East Coast standards.
However, his tax hike plan does little to deal with a fundamental flaw – a high tax rate for the middle-income residents who represent a large chunk of his constituency.
Gov. John Carney is correct when he talks about “kicking the can down the road” in not dealing with underlying fiscal problems.
Then again, nearly a dozen legislators of varied ages decided to not run for another term. One cannot help but think that they know a day of reckoning is on the horizon.
Meanwhile, Republicans have been handed a compelling issue.
Agree or disagree? Let me know. The newsletter returns on Monday, with a break on Wednesday in observance of July 4. – Doug Rainey, publisher.
