The State Auditor’s sounding a note of caution about a huge new state economic development fund. State Auditor Dave Vaught says he agrees the state needs to do some things to boost the economy he says those ideas have to be based on a sound financial strategy. Vaught says the state’s taken a billion dollars out of reserves and special accounts in the past three years to balance the state budget, and lawmakers haven’t figured out when or how to repay that back. He says it’s becoming the practice rather than the exception. Vaught warns there could be deep cuts in the state budget if the state finds it can’t repay its mounting debts. He says the state will eventually be forced to make changes if it keeps depleting its resources without replenishing them. Vaught warns that state tax revenues may continue to fall in coming as, for example, legislators in 2002 approved a big tax cut for the state’s insurance industry that hasn’t taken effect yet and the state sales taxes on utility bills is gradually being phased out.
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