Welcome to The Senate Site

By Lyle Hillyard
Senate Chair of Executive Appropriations

Utah enjoys one of the hottest economies on the planet, but we learned this week that we may not be completely immune from the larger national picture. State revenue collection for the last month has turned out to be slightly less than we expected it would be. We are still within the range we predicted last February, however.

More detail: The most recent Tax Commission Revenue Summary shows combined year-to-date General Fund and Education Fund revenues down 0.8% at the end of May -- lower than February's Fiscal Year 2008 growth forecast of 0.6%. Here's the report.

Our economists now predict revenue for Fiscal Year 2008 (which ends this month) will be in a range between $100 million lower and $70 million higher than the February forecast, with likely risks on the downside.

This is not a surprise. Some of us old timers have been through an economic cycle or two and you probably remember us worrying about it during session. I'm proud of my colleagues for supporting wise fiscal policies such as limiting spending, depositing $100 million into the Rainy Day Fund over the last two years, setting-aside another $100 million for next year, and carefully building a balanced budget. We're so old-fashioned we look progressive.

Bottom line: We will be just fine for Fiscal Year 2008, but we'll need to watch the cash flow collections like hawks. If it turns out we need to address the Fiscal Year 2009 budget we should be able to do so in the upcoming legislative session.

Interestingly, revenue collections at the end of April were slightly higher than we forecast - so we don't think this recent atypical drop can be completely attributable to the economy. Two factors that may have played a part are 1) recent adjustments to the state withholding tables, and 2) a new method of collection we just implemented.

We'll have a more complete picture for you when we close out FY 2008 (which is usually mid-August). We appreciate the citizens of this state who monitor the Senate Site and pay attention to what happens on Capitol Hill.

We'll keep you in the loop as the situation unfolds.

1 Comments:

 The Senate Site said...

Senator Hillyard's blog was highlighted in today's Utah Pulse Newsletter. (And in a Deseret News article.)

6/19/2008 10:52 PM  

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