(Source: MIRS.news, Published 01/13/2022) The state's revenue numbers continue to exceed expectations.
Projections reached Friday have Michigan's General Fund and School Aid Fund increasing $1.24 billion above last May's projections for the current fiscal year and $1.3 billion for Fiscal Year (FY) 2024.
Meanwhile, the state's surplus has climbed to an unprecedented $9.2 billion ($5.1 billion General Fund, $4.1 billion School Aid Fund), according to information shared at Friday's Consensus Revenue Estimating Conference (CREC).
“We have, going into this conference, some healthy balances right now and that should also help us mitigate any sort of immediate mild recession in the next few months,” said Budget Director Chris Harkins.
Back in May, School Aid and General Fund revenue for FY '22 was projected to be $31.168 million. Friday, the Department of Treasury, the Senate Fiscal Agency and the House Fiscal Agency bumped that number up to $32.413 million.
For FY '23, the number went $31.67 billion in May to $32.938 billion, after the Department of Treasury, Senate Fiscal Agency and House Fiscal Agency principals emerged.
The projection for the General Fund revenue was more than $14.7 billion in FY 2023, which is a change of $804.4 million from May 2022. The estimate for FY 2024 General Fund revenue was nearly $15.1 billion, which was an increase of $314.3 million. The General Fund for 2025 is nearly $15.5 billion, which was an increase of $453.3 million.
“Although the last couple of years have provided an extraordinary revenue picture, we must be thoughtful and deliberative about our policy choices due to the uncertainty on the horizon,” said state Treasurer Racheal Eubanks.
The estimate was based off a projected unemployment rate of 4.8% by 2024, which was the indicator of the mild recession.
“The nature of this forecast also reminds us that revenues may fluctuate, and it remains important that we continue to ensure that any available one-time revenues be used for one-time investments to grow and build Michigan,” Harkins said.
The conference was held in-person in the House Appropriations Room for the first time since the start of the COVID-19 pandemic, but it also offered an online option to watch.
The consensus was made up of three projections from the Treasury, Senate Fiscal Agency and House Fiscal Agency. All three indicated a loss from the numbers estimated in January 2022.
“CREC is a glimpse into how people are doing economically and what the future holds for our residents and revenues,” said Sen. Sarah Anthony (D-Lansing). “While today’s presentation got very technical, one thing is abundantly clear: Today’s estimates bode well for the Majority’s policy agenda and first budget process.”
The Senate Fiscal Agency report was released Jan. 11.
