RI tax revenue forecast cut by $10 million

PROVIDENCE, R.I. (WPRI) – Rhode Island’s budget math just got a little tougher.

The number-crunchers who took part in the state’s semiannual Revenue Estimating Conference announced Friday that they expect state revenue to be $10.3 million lower in the current 2017-18 budget year than they projected in May, the last time they met.

Steve Whitney, the Senate fiscal adviser, said there was no single factor causing the somewhat weaker revenue picture. “It’s pretty widespread across the board,” he said.

The governor and lawmakers are required to use the Revenue Estimating Conference’s forecasts when they put together the annual state budget. The November estimates are used to create the governor’s initial proposal, expected in January, and then those numbers are updated in May so lawmakers can use the revised figures to finish the final version.

The new estimates show state revenue is still projected to increase this budget year versus last year, from $3.68 billion in 2016-17 to $3.82 billion in 2017-18. From there it’s expected to rise by another $39 million in the 2018-19 budget year, to total $3.86 billion.

Friday’s meeting – effectively a public negotiation between top aides from the House, the Senate and the governor’s office – lasted all day and well into the evening, as Gov. Gina Raimondo’s aides pushed for significantly higher revenue estimates than legislative staffers said were reasonable.

Earlier in the week the same group of experts released a separate forecast that shows state spending on social services is now expected to be about $29 million higher in 2017-18 than authorized under the budget enacted a few months ago. And it’s forecast to rise by another $44 million in the new budget year that starts next July 1.

State officials previously estimated the governor would need to close a deficit of $237 million in her upcoming budget proposal. It’s unclear how much the new estimates will change that number.

Ted Nesi (tnesi@wpri.com) covers politics and the economy for WPRI.com. He writes Nesi’s Notes on Saturdays and hosts Executive Suite. Follow him on Twitter and Facebook