As Kriss predicted, today’s revenue forecast increased the funds available for budget writers this session.

The Economic and Revenue Forecast Council (ERFC) now expects state revenues from funds subject to the outlook (NGFO) to be $52,339.5 million in 2019–21 (an increase of $606.0 million from the November forecast) and $55,689.8 million in 2021–23 (an increase of $535.7 million from the November forecast).

According to the ERFC, two major contributors to the increases are unexpectedly high estate tax collections and increased property tax collections (due to new estimates of market value). 2019–21 revenues are now expected to increase by 13.6 percent over 2017–19, and 2021–23 revenues are expected to increase by 6.4 percent over 2019–21. But, the ERFC notes, “The level of uncertainty in the baseline remains elevated, with downside risks outweighing upside risks.”

The 2019–21 biennial budget enacted last year was based on the March 2019 NGFO revenue forecast and about $1 billion in new taxes (including the workforce education investment surcharges). Given economic changes since the budget’s adoption, the Legislature now has $2.158 billion more to work with (from funds subject to the outlook) over the four-year period (through 2021–23). Most of that ($1.454 billion) comes from economic changes to the forecast for 2019–21.