|
tax if the governor's capital budget is re-
duced. I would want to go over this with
Mr. Lewis and others of our Committee, be-
cause if there is any clarification that is
needed, I would like to be sure of the
grounds that we are talking about.
DELEGATE J. CLARK (presiding):
Delegate Grumbacher.
DELEGATE GRUMBACHER: The rea-
son I brought this up was to make sure we
got into the record exactly what we meant
on this, so the legislature will understand
the meaning of it.
DELEGATE SHERBOW: Delegate
Grumbacher, at the proper time we are
| endeavoring to clarify this, because your
question does raise a point about which
I there may be a doubt.
i
DELEGATE J. CLARK (presiding):
j The Chair recognizes Delegate Bamberger.
| Do you still wish the floor?
DELEGATE BAMBERGER: Mr. Chair-
| man, I would like to discuss more on sec-
tion 6.11, because I think it does make sub-
stantial change in the present practice.
As I understand the present practice,
| .he governor submits a budget for proposed
[ capital expenditures which will be sup-
l ported by a tax on real estate at a rate to
oe fixed by the Board of Public Review to
raise the necessary revenue. If under the
present practice the General Assembly may
add capital expenditures to that budget,
without legislating1 any particular tax
source, the result only being that the rate
finally fixed by the Board of Public Works
is increased by the amount of that capital
expenditure added by the General As-
sembly, is it true that this section 6.11
allows the executive to submit a budget for
capital expenditures which is not financed
by any particular tax source, but is fi-
nanced by the general taxing power of the
State and the full faith and credit of the
State, but that if the General Assembly
desires to add to those capital expenditures,
they must devote to that some new tax or
new revenue from an existing tax?
DELEGATE J. CLARK (presiding):
Delegate Sherbow.
DELEGATE SHERBOW: I have to go
back.
When the governor submits his capital
budget program, that portion of it which
is to go into effect in the next fiscal year
| must carry with it a taxing program to
| take care of whatever may be interest and
|
amortization requirements. There well may
be none for that next fiscal year. It may
not be any, except for interest. Amortiza-
tion may not begin for two more years
thereafter, but the budget must be in
balance.
To the extent that the taxes are re-
quired, they must be there.
DELEGATE J. CLARK (presiding):
Delegate Bamberger.
DELEGATE BAMBERGER: If the leg-
islature wants to add any capital expendi-
tures, they must either enact a new tax
or increase the rate of some existing tax
to finance that expenditure; is that correct?
DELEGATE SHERBOW: Yes. But here
I have this problem raised by Delegate
Grumbacher.
What we have said is that capital ap-
propriations submitted to the General As-
sembly by the governor must necessarily
be supported by revenues sufficient to cover
debt service, and the General Assembly is
required to provide tax revenue that is
necessary to pay the debt service on any
capital appropriations that are in addi-
tion to or exceed those submitted to the
General Assembly by the governor.
He has raised the point that if the Gen-
eral Assembly has cut out some of that
which the governor has put in, what hap-
pens under those circumstances? Do they
have to provide that additional tax?
On this I want to be certain of my
ground later when I have looked into this
and talked it over.
DELEGATE J. CLARK (presiding):
Delegate Bamberger.
DELEGATE BAMBERGER: I under-
stand Delegate Grumbachcr's question. But
that is not my question.
Let us assume that the General Assembly
does not delete or reduce any part of the
capital appropriations bills submitted by
the governor, but adds to it. It is per-
fectly clear they are adding to it.
In order to do that they must, in de-
parture from the present practice, either
levy a new tax or increase the rate of
some existing tax.
DELEGATE SHERBOW: They are re-
quired to provide the tax revenue neces-
sary to pay that debt service. That is not
a departure from the present practice.
DELEGATE J. CLARK (presiding):
Delegate Bamberger.
|
