The State’s reductions to these programs, included the following elements: Additionally, the ETR transfer was calculated prior to the $32 million reduction. The budget included the mandatory ETR increase by 6.5%, which was accomplished by transferring the 6.5% increase from the CMPTRA line to ETR. Resulting in a $32 million total reduction in formula aid in the year 2009. A “needs based” formula was used to change each municipality’s fiscal 2009 distribution. In 2009, the State again changed the formula, and ETR and CMPTRA, which were originally looked at as two separate numbers, were combined as one number. However, this 1% actually represented a 16.7% increase in revenue based on the current rate of the average resident’s spending. The 1% increase was earmarked for Property Tax Relief. In 2006, the State’s Sales Tax was increased by 1% (from 6 to 7%). (The implicit price deflator is used to measure the impact of inflation on governmental spending.) This went into effect after state fiscal year 2002. In 1999, legislation was signed to provide that ETR and CMPTRA distributions would annually increase at the rate of the implicit price deflator.
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