State Revenues Plunge, Despite Sales Tax

State revenue collections have come in more than a quarter-billion dollars below expectations for September, despite a new sales tax and signs of economic recovery.

Gov. Deval Patrick said the $243 million shortfall shows the recession continues to take its toll on state coffers. "Although the private sector economy is beginning to recover, state government is still feeling the impact of the global economic collapse," he said.

The shortfall will likely force a new round of layoffs and budget cuts, raising concerns among social service programs that have already seen their budgets slashed.

"Some of the budgets supporting our organizations have been cut 50 percent in the most recent budget," said Lew Finfer, who heads the Massachusetts Communities Action Network, an umbrella group for job training and anti-violence programs. "To think of additional cuts makes one shudder."

Meanwhile, the Department of Health and Human Services has canceled hearings about potential budget cuts with social service providers slated for the next week.

Patrick says he plans to make the necessary cuts to balance the budget by the end of this month. The administration has until October 15 to issue revised revenue estimates for the next nine months.