Yesterday the Caseload Forecast Council (CFC) adopted its November caseload forecast. This forecast estimates how many people will be eligible for entitlement programs. It will feed into the maintenance level (the cost of continuing current services) for the governor’s 2022 budget proposal.

Overall, caseloads are now estimated to be lower than forecasted in February 2021, which was the caseload forecast on which the 2021–23 operating budget was based. According to the Office of Financial Management (OFM), the forecast and per capita impacts are estimated to reduce general fund–state (GFS) spending by $645.8 million in 2021–23.

The largest component of that savings estimate is K–12 education. The current forecast estimates that common school enrollment for school year (SY) 2021–22 is 52,284 (4.7%) lower than expected in Feb. 2021. Enrollment for SY 2022–23 is now estimated to be 48,384 (4.3%) lower than expected in February.

As the chart below (from the forecast) shows, the Feb. 2021 and June 2021 forecasts had assumed that school enrollment would bounce back in SY 2021–22, after declining by 3.7% in SY 2020–21. Now, enrollment for SY 2021–22 is expected to drop by 230 students (0.0%) over SY 2020–21, then increase by 7,400 students (0.7%) in SY 2022–23. (As I noted here, the enrollment jump in SY 2016–17 was related to the implementation of full-day kindergarten.) Because K–12 enrollment is no longer expected to bounce back in 2021–23, OFM estimates that the state will save $521.8 million.

Another big contributor to the cost savings is Corrections and juvenile rehabilitation. Caseload reductions in these programs are estimated to save the state $117.6 million. These reductions are due to lower admissions related to the pandemic and increased releases due to state law changes and the state Supreme Court decision in State v. Blake. For example, the chart below shows the forecast changes for community supervision.

The $645.8 million in total estimated savings from the forecast frees up state funds that can now be used for other purposes. This is still more good news for budget writers. Other resources include:

• The September revenue forecast is $5.493 billion above what was anticipated in the budget (through 2023–25).
• The October collections report added $152.7 million.
• The state still has $1.273 billion in one-time general federal relief money to appropriate.
• There is $1 billion sitting in a shadow reserve account.