The bottom line in today’s revenue forecast will bring some comfort to state budget writers. Here’s the summary slide:
Some upward revision was expected, as collections since the February forecast have been coming in above expectations. While the gain is welcome, it’s also not a game-changer. The $126 million bump for 2017-19 brings the biennial estimate to $40.252 billion, 7.5 percent above the projections for the current 2015-17 budget cycle.
As forecast council members discussed, there will be two more forecasts (September 21 and November 16) before lawmakers return for the 2017 legislative session. As budget director David Schumacher said, “The numbers will all continue to move between now and January.”
Those numbers include caseload forecasts and estimates of returns on state pension funds. Further, there’s still no consensus on how much additional revenue will be required in the 2017-19 budget to satisfy the state’s obligations to fully fund basic education under the state Supreme Court’s McCleary mandate.
The forecast presentation also included this caution:
The level of uncertainty in the baseline remains elevated, with downside risks outweighing upside risks
Still, the forecast increases underscore the general health of the state economy, which continues to outperform the nation “by a small margin” according to economist and forecast council director Steve Lerch.
As always, there’s a lot of good economic information in the meeting materials for those interested in understanding the basis for the revised estimates.