The State of Wisconsin ended its Fiscal Year on June 30, 2022, with a record positive balance of $4.30 billion, according to the new state Annual Fiscal Report released today by the state Department of Administration. That report also confirms that Wisconsin has a record $1.73 billion in its Budget Stabilization Fund (a/k/a “Rainy Day” Fund).
New data shows state income and sales tax collections grew faster than expected in FY2022, propelling the state’s general fund surplus to never-before-seen levels. Taxes flowing into Wisconsin’s general fund grew by 5 percent over the previous year (or just under $1 Billion). In January 2022, the Legislative Fiscal Bureau had projected general fund tax collections, which come principally from income and sales taxes, would fall by 3.2 percent.
Much of the growth in general fund revenues came from increased sales taxes. That increase in sales tax collections was likely helped by inflation, which drove up the price of goods and services, and in turn pushed sales tax collections higher.
Larger than anticipated revenue growth and lower than expected expenses—state general fund spending was about 2 percent less than budgeted—left the state with significantly larger general fund surplus than had been projected. The June 30 balance of $4.3 billion was $1.46 billion larger than the LFB had projected as recently as January 2022.
According to a news release from the DOA, noteworthy items from the Fiscal Year 2022 Annual Fiscal Report include:
- The State’s undesignated general fund balance at the end of FY 2022 was $4.3 billion, nearly 70% higher than the prior year’s balance of $2.58 billion, and more than seven times larger than the balance at the end of FY 2018.
- The current Budget Stabilization Fund balance remains at $1.73 billion, the largest in the State’s history and more than five times larger than the balance at the end of FY 2018.
Editor’s Note: The state’s fiscal good fortune likely means that whoever wins the governor’s race next month is going to have a once in a generation opportunity to use these funds to transform the state and its programs. One area in need of transformation is school funding. The WASB has lots of ideas about how to accomplish this.
