Governor John P. deJongh, Jr. submitted his $1.2 billion Fiscal Year 2012 budget proposal to the the 29th Legislature of the Virgin Islands on Friday.
Of the total budget, $731.3 million would come from the General Fund - $50.6 million less than the FY 2011 budget. The remaining budget would derive revenues from federal funds and special funds.
"This coming year, even more than in the current year, we must make do with less, we must make and live with hard decisions, and we must resist the temptation to evade our responsibility to make hard choices for our community," deJongh said in his transmittal letter to Senate President Ronald E. Russell.
The 2012 budget will not rely on external borrowing - something the government has used to shore up deficits in the past few years. DeJongh said the government must live within its means and only rely on revenues to support expenditures.
"These cuts will be felt across the Government and require reductions in the current appropriation levels of all departments and agencies, including the other branches of government and the semi-autonomous agencies," deJongh said.
DeJongh said FY 2012 net revenues are projected at $682.5 million, which is more than $100 million less than "pre-crisis" levels.
The 2012 revenue projection reflects stabilizing core revenue streams, with some modest growth, he said. He said Personal Income Tax and Corporate Income Tax collections will increase 7 percent from the current fiscal year, and Gross Receipts Taxes should increase by 20 percent from FY 2011 levels.
Budget also is supported by the collection of two years' worth of real property taxes, deJongh said.
Office of Management and Budget Director Debra Gottlieb said the FY 2012 budget includes a combination of increasing revenues with an increase of 0.5% in gross receipts taxes, eliminating certain caps on penalties and interest on real property taxes and decreasing expenditures with measures such as not paying government employees for nine legal holidays.