Revenue Estimating Conference projects lower revenue
March 16, 2017
The Revenue Estimating Conference (REC) on Tuesday delivered a grim report on revenue projections for the fiscal year 2017, which ends June 30, 2017, and fiscal year 2018, which begins July 1.
The REC determined that revenue projections are lower than anticipated by $131 million for FY17. It also lowered its revenue projection for FY18 by $191 million. The REC was expected to lower projections, but not by this margin. A de-appropriations bill was passed and signed earlier this year that already cut $118 million from FY17. The Legislature and Gov. Terry Branstad have several options to deal with the shortfall, including across the board budget cuts, passing another de-appropriations bill or using money from the rainy day fund.
The governor’s spokesman Ben Hammes released a statement on Tuesday indicating that Gov. Branstad and Lt. Gov. Kim Reynolds support using savings in the cash reserves, rather than additional budget cuts, to meet the current fiscal year needs. Click here to read the full statement.
Holly Lyons, director of the Fiscal Division of the Legislative Services Agency, said a host of factors are affecting state revenue, particularly Iowa’s soft ag economy. Republican leaders have indicated that tax credits are on the table for discussion this session. ABI will continue to monitor this issue and provide updates.
Read more: Facing $131 million budget shortfall, state will likely dip into reserves (Des Moines Register)