The Legislative Fiscal Bureau (LFB) recently released their latest revenue estimates for the current fiscal year (FY 2016-17) and for the 2017- 19 biennium. In November, the Department of Administration (DOA) and the Department of Revenue (DOR) projected the state would end the current fiscal year with a $104 million balance. The most recent estimates increase the ending balance by $322.4 million, for a gross ending balance of $427.2 million.
LFB cites several reasons for the increased end-of-year balance. For one, tax collection estimates look positive and exceed the November report by $63.4 million. The second factor is department revenues are $33 million above the November report. However, current year appropriations are down $226 million, largely due to underspending in the state’s Medicaid program.
Looking forward into the biennium, the LFB estimates $391 million more in general fund tax collections than the November report ($145.3 million in 2017-18 and $245 million in 2018-19). LRB projects general fund tax collection to increase by 3.4 percent in the first year of the biennium and 3.6 percent in the second year. LFB bases their projections on tax collection data and national economic forecast factors.
Responding to an inquiry from Assembly Speaker Robin Vos (R-Rochester) LFB issued a second memo the following day with summary of general fund revenue that would be available for the biennium. Per LFB analysis, $1.6 billion of additional revenue collections will in available in the biennium. Adding that to the positive year-end 2016-17 balance, the additional collections will total roughly 2 billion dollars.
Legislators quickly reacted to the positive numbers. Assembly Republican leaders called for $300 million in unidentified tax cuts as an offset to new revenues for the Transportation Fund. Details of the plan, according to Assembly Republicans, may be available in the next 60 to 90 days. Governor Walker, through a spokesperson, indicated he is interested in seeing the details.