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House budget chief says a tax increase is necessary

FRANKFORT — A tax increase is needed to solve the nearly half-billion budget shortfall Kentucky faces, House budget chairman Harry Moberly Jr. said Tuesday.

Moberly, D-Richmond, said erasing the shortfall only with cuts "would be too painful" and would "seriously cripple" important programs.

Moberly's comments came after he and several House leaders met privately for about an hour in the Capitol with Gov. Steve Beshear and members of his staff. Beshear had met earlier in the day behind closed doors with Senate leaders.

After the meeting with House leaders, Beshear declined to say whether he will propose a tax increase when he releases his plan on Thursday or Friday to address a projected $456.1 million shortfall in the budget this fiscal year.

He unsuccessfully pushed for raising the state cigarette tax from 30 cents a pack to $1 a pack in this year's legislative session.

Moberly said the Democratic governor told legislative leaders he was not yet sure whether he will include revenue-producing measures in his plan.

Senate President David Williams, a Burkesville Republican who has been resistant to any tax increase, said without elaboration in a statement that his discussion with Beshear "was a candid and confidential meeting about how to move Kentucky forward."

Meanwhile, the state budget office said Tuesday that November revenue receipts for the state rose from the same month a year ago but year-to-date receipts were down.

General Fund receipts rose 5.8 percent compared to November 2007, an increase of $38.7 million.

Beshear downplayed any gains in revenue, saying he expected that revenues would decline in the remaining months of this fiscal year based on estimates by a group of independent economists.