State’s revenue picture better than expected

Latest forecast for fiscal year $227.9 million higher than projected

Colorado’s general fund revenue is projected to be $227.9 million higher this fiscal year than an earlier forecast, which may or may not mean a one-time boost to the University of Colorado and other institutions of higher education.

The good news came on Monday, when the Governor’s Office of State Planning and Budgeting (OSPB) also announced a forecast for the 2013-14 fiscal year that’s $256.1 million higher than was projected in December.

Better-than-expected growth in income tax revenue, from individuals and corporations, is credited with the forecast’s increase.

Still, revenue is likely to remain volatile in the future; while improvement in the housing market and consumer spending is helping current forecasts, revenue from one-time stock sales is driving much of the latest growth. OSPB’s forecast reports that growth might slow next year.

“While economic activity at the national level continues to be modest and uneven, Colorado has many attributes necessary for success in the post-Great Recession economy, fostering its position among the top states in economic performance,” according to the forecast. “Economic growth is expected to moderate in 2013 due to recent federal tax rate increases and budget reductions, the heightened uncertainty surrounding the federal debt level, and headwinds from the European economic and financial crisis.”

The news comes ahead of the Legislature’s discussion of the budget, which will be decided upon in the coming weeks. CU and other institutions of higher education are not likely to see further cuts this year given the projection, though whether additional funding will be made available by lawmakers isn’t known.

The state’s next revenue forecast will be delivered in June.

Click here for the full forecast report from the Governor’s Office of State Planning and Budgeting.

Tagged with: