Week in Review from State Senator Doug Overbey

Finance Committee hears revenue updates
in preparation of budget consideration

The Senate Finance Committee received an update on the state’s revenue collections and growth estimates in preparation for its work on the budget.  For the 22nd consecutive month, Tennessee’s revenue collections continued to fall short of budgeted estimates in March, according to Finance Commissioner Dave Goetz, who appeared before the Senate Finance Committee this week. The overall March revenues were $776.5 million, which is $11.7 million less than the state budgeted.  Goetz told committee members that they see some improvement in major items, like automobile sales, but until they see clear signs that the economy is recovering, they will continue to make budget decisions based on what “we’re experiencing in Tennessee.”

Year-to-date collections for eight months were $244.1 million less than the budgeted estimate. The general fund was under collected by $205.0 million and the four other funds were under-collected by $39.1 million. Goetz told the committee that Governor Bredesen will present a budget amendment to lawmakers within a week.

State Comptroller Justin Wilson presented the state’s Funding Board estimates for the current and upcoming fiscal years to the Finance Committee.  For the fiscal year ending June 30, 2010, the Funding Board expects the revenue growth rates to be negative, ranging between -1.77 percent and -1.29 percent for total tax revenues and between -2.31 percent and -1.78 percent for the state’s general fund. The Board projects some improvement for the 2011 fiscal year that will begin July 1 with projections for a positive growth rate ranging between 1.73 percent and 1.98 percent. The Funding Board also anticipates a positive growth rate for the general fund between 2.05 percent and 2.30 percent.