Good News! Senate Fiscal Agency Report Shows Increasing Revenue

The Senate Fiscal Agency released a report showing preliminary final fiscal year 2012-13 General Fund and School Aid Fund combined revenue for the state is $433.5 million above the May 2013 revenue estimating conference numbers, and it also projected the state's economy could grow 3 percent in 2014.

The Michigan Economic Outlook and Budget Review also revised its revenue estimate for the current 2013-14 fiscal year upward by $328 million and the 2014-15 fiscal years by $514 million.

Preliminary numbers for the 2012-13 fiscal year show combined revenue totals of $20.8 billion, up 3.4 percent from 2011-12. The numbers constitute the official SFA forecast that will be part of the January 10, 2014 Consensus Revenue Estimating Conference with the House Fiscal Agency and the Department of Treasury.

"The increase reflects an improving economy, combined with lower-than-expected refunds under the Michigan Business Tax and an additional increase in individual income tax revenue from taxpayers receiving dividends and taking capital gains in anticipation of tax changes associated with the federal 'fiscal cliff" in December 2012," the report says.

Because of the robust revenue coming from the income tax, the General Fund is further ahead of expectations than the School Aid Fund. For the 2012-13 fiscal year that ended September 30, the General Fund was $376 million above the May forecast compared to $57 million above expectations for the School Aid Fund.

The economy is projected to grow more rapidly in the current fiscal year than it did in 2012-13, but the loss of one-time revenue from 2012-13 and increases in business tax credits will offset the potential increase in revenue, the report notes.

posted by PAA Online , Friday, January 3, 2014 10:50 AM
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