State Leaders Release Revised Revenue Numbers
SALT LAKE CITY (Feb. 22, 2016) – Utah’s consensus revenue numbers were released today in cooperation with leaders from the Senate, House of Representatives and the Governor’s Office of Management and Budget.
After making adjustments related to increased income tax, lower severance tax and other revenue adjustments, the new consensus estimates provide $400 million for additional ongoing appropriations, $20 million higher than the December estimates. In addition, $150 million is available for one-time appropriations, $30 million lower than December estimates.
“The revised revenue numbers released today show overall growth in income throughout the state with the exception of declining prices, primarily in the energy sector,” Gov. Herbert said. “Utah’s continued commitment to fiscal conservatism positions us well as we make critical budget decisions in the weeks ahead.”
Senate President Wayne Niederhauser said, “These numbers are the final target to which we will balance the budget over the next few weeks. They are optimistic but conservative – we expect that Utah’s economy will continue to grow as we work to manage our revenues and expenditures judiciously. A reliable state budget always hinges on a reasonable, conservative budget forecast.”
“The Utah Legislature has some of the best fiscal analysts of any state in the country,” said Speaker Greg Hughes. “We do estimates in December and February to closely monitor the changes in the economy and our analysts respond accordingly. These combined revenue estimates have remained largely unchanged and give us the framework for completing our budget process.”
- Utah’s combined General Fund and Education Fund revenue estimates remain largely unchanged from December, the combined effect of healthy increases in individual income taxes, reductions in oil and gas-related taxes, and an abundance of caution concerning the direction of markets. State economists tend to take a cautious approach to revenue estimating, an approach that has served the state well in the past. Even given this approach, economists expect revenue will increase 4.5% year-over-year in the coming year.
- State economists project economic growth will be stronger than expected in the fiscal year that begins July 1 (FY 2017), increasing ongoing revenue estimates by $20 million. This increased estimate is driven primarily by healthy increases in household incomes. The State is estimated to $400 million in new ongoing revenue to allocate this General Session. Of this total, $350 million is in the Education Fund and $50 million is in the General Fund.
- Largely due to the effect of low oil and gas prices and caution related to global economic conditions, one-time FY 2016 collections are now expected to be $30 million (-0.5%) less than previously estimated in December. Even after that adjustment, Utah is estimated to have $150 million more in collections for FY 2016.