Another Collections Shortfall

The Economic and Revenue Forecast Council (EFRC) issued its monthly update late this afternoon. The document is available here. These three bullets from the update summarize the key takeaways:

  • While our economic forecasts have been accurate, our models appear to be overforecasting revenue. To be fair, these are unprecedented times, and continued weakness in consumer spending is creating a “revenue-less recovery.”
  • Major General Fund-State revenues for the October 11 – November 10, 2009 collection period were $65.2 million (5.7%) lower than our September forecast. There were two large unexpected refunds totaling $7.2 million during this period. Excluding the refunds, the variance was -$58.0 million (-5.1%).
  • Cumulatively, revenues from the September 11, November 10, 2009 period are $97.4 million (4.7%) below the September forecast. Large one-time refunds accounted for $20.2 million of the negative variance. Excluding refunds, the total variance is -$77.2 million (-3.7%).

The EFRC will update its forecast of general fund revenue for the 2009 - 11 biennium on November 19. Given the recent collection shortfalls, a reduction in the forecast is likely.

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