Michigan Economy Continues to Improve, Revenues Expected to Grow
LANSING, MI —State Treasurer Nick Khouri, incoming State Budget Director Al Pscholka, Senate Fiscal Agency Director Ellen Jeffries and House Fiscal Agency Director Mary Ann Cleary today reached consensus on economic and revenue figures for the remainder of Fiscal Year (FY) 2017 and for the upcoming 2018 and 2019 Fiscal Years.
Following today’s Consensus Revenue Estimating Conference, net FY 2017 General Fund-General Purpose (GF-GP) revenue is projected at $10.290 billion, up $152 million from estimates agreed to in May. Net FY 2017 School Aid Fund (SAF) revenue is now estimated at $12.457 billion, up $55 million from May.
“Today’s consensus revenue conference once again confirms the positive outlook for Michigan’s economy,” Khouri said. “The growing economy supports modest, but positive growth in state revenues during the next three years.”
Net GF-GP revenue for the FY 2018 — which begins Oct. 1 — is now forecasted at $10.523 billion, down $84 million from May’s estimate, while the FY 2018 SAF revenue estimate has been revised up by $22 million to an estimated $12.783 billion. Due to these higher than expected revenues, the state has nearly $330 million in added one-time revenue to invest in the FY 2018 budget.
In FY 2019, GF-GP revenue is estimated at $10.589 billion and SAF revenue is estimated at $13.132 billion. These are the initial revenue estimates for FY 2019.
“With the additional revenues that were agreed upon today, we now have an accurate and agreed upon revenue forecast on which to finish our work for the release of the budget in early February,” Pscholka said. “While today’s news is very positive, it is important to remember that we have some one-time revenues for 2018 that will not be built into the ongoing base budget and we will be facing a number of budget pressures in 2019. Our track record of taking a long-term view of state finances and building fiscally responsible budgets is strong and that will not change.”
These revenue estimates are based on the most recent economic projections and forecasting models. As with any economic and revenue forecasts, there are potential risks to the estimates agreed to today, including national economic trends, international economic issues, and a significant change in oil and gasoline prices.