May 3, 2016

Independent Fiscal Office Projects $1.86 Billion Structural Deficit In FY 2016-17

The Independent Fiscal Office Tuesday released its revised revenue estimates which projects $31.586 billion in state revenue to be available in FY 2016-17, a 1.8 percent increase over FY 2015-16, with a structural deficit of $1.86 billion.
The IFO estimated the Governor’s proposed budget for next year would spend $31.772 billion without any new revenues.  With new revenues, the Governor’s budget would be $33.28 billion.
The IFO projected stronger revenues for FY 2015-16 coming in about $300 million above estimates and exceeding the approved budget by $150 million.
There were several limiting “technical” factors (in English decisions to cut taxes, provide more tax credits or other uncontrollable factors) in constructing the 2016-17 budget, including the elimination of the Capital Stock and Franchise Tax ($141 million), the continued decline of unclaimed property/escheats collections ($146 million), one less PIT withholding due date in 2016-17 compared to 2015-16 ($115 million), corporate credits ($40 million) and non-recurring transfers ($27 million).
A copy of the IFO revenue estimates is available online.
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IFO: Wolf’s Severance Tax Has Highest Rate In Nation, Nothing For The Environment