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Legislative Update

New state fiscal forecast provides cause for optimism

by | Jan 27, 2021 | Legislative Update Blog, State Budget, State Issue, Uncategorized

A new analysis of the state’s finances released yesterday (1/26) by the non-partisan Legislative Fiscal Bureau (LFB) projects that state revenues over the current fiscal year and the next two fiscal years comprising the 2021-23 biennial budget will be $1.156 billion higher overall, than earlier estimates released in November by the state Department of Administration (DOA). That will ease pressures on state finances somewhat and could mean lawmakers will be able to provide some of those additional revenues to fund schools in the upcoming 2021-23 biennium.

In a memo to the co-chairs of the legislature’s budget-writing Joint Finance Committee, LFB Director Bob Lang wrote that the state is now expected to finish the current fiscal year on June 30, 2021 with a gross balance of nearly $1.9 billion, compared to more than $1.2 billion that been had projected back in November. 

Lang noted that revenue collections in the current fiscal year are now expected to be $437.4 million more than what the Department of Administration had projected in November. Further, the state is now projected to spend about $190.7 million less than had previously been forecast.

A key excerpt from the new report states:
“Our analysis indicates that for the three-year period, aggregate general fund tax collections will be $1,155.9 million higher than those of the November 20 report ($437.4 million in 2020-21, $265.6 million in 2021-22, and $452.9 million in 2022-23).
“Based upon the November 20 report, the administration’s general fund condition statement for 2020-21 reflects a gross ending balance of $1,221.9 million and a net balance (after consideration of the $85.0 million required statutory balance) of $1,136.9 million.
“Our analysis indicates a gross balance of $1,851.4 million and a net balance of $1,766.4 million. This is $629.5 million above that of the November 20 report.”
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