PROVIDENCE, R.I. (WPRI) – Money is pouring into Rhode Island’s state coffers at a fast clip as the economy continues to bounce back from the pandemic.
The number-crunchers who took part in the state’s semiannual Revenue Estimating Conference announced Wednesday that state revenue should be $274 million higher in the current 2021-22 budget year than they had projected the last time they met, back in May.
The entire state budget this year is $13.1 billion, of which 45% is federal funds.
The above-forecast tax receipts add to the pile of cash available to Gov. Dan McKee and state lawmakers as they prepare to make major spending decisions in the coming months. The budget surplus for the 2020-21 fiscal year, which ended June 30, already came in $51 million higher than expected.
On top of that, the state has yet to spend a dime of the $1.1 billion in federal money it was allocated through the American Rescue Plan Act’s State Fiscal Recovery Fund — money that is currently the subject of a State House tug-of-war between McKee and General Assembly leaders. The White House also estimates Rhode Island will receive over $3.4 billion from President Biden’s new infrastructure bill.
“We are pleased that the revenue estimates signal continued strength as we emerge from the worst of the pandemic,” House Finance Committee Chairman Marvin Abney and Senate Finance Committee Chairman Ryan Pearson said in a joint statement. “We will continue our work to assess the multitude of proposals and identified needs for both one-time and ongoing resources to ensure a lasting recovery.”
The governor and lawmakers are required to use the Revenue Estimating Conference’s twice-a-year forecasts when they put together the annual state budget. The November estimates are used to create the governor’s initial proposal, due in January. Then those numbers are updated in May so that lawmakers can use the revised figures to finish the final budget, usually completed in June.
The new estimates show state general revenue is projected to increase this budget year versus last year, from $4.43 billion in 2020-21 to $4.68 billion in 2021-22. From there revenue is expected to rise by about $69 million in the 2022-23 budget year, to $4.75 billion. (Budget years run from July 1 to June 30.)
Put another way, state general revenue is projected to rise by over $300 million over two years. (The category of “general revenue” excludes some other significant sources of state revenue, such as the gas tax, college tuition payments or truck tolls.)
A separate report due out next week, which takes into account the spending side of the ledger, will show whether the state is currently on track to run a deficit or a surplus this fiscal year.
Ted Nesi (firstname.lastname@example.org) is a Target 12 investigative reporter and 12 News politics/business editor. He co-hosts Newsmakers and writes Nesi’s Notes on Saturdays. Connect with him on Twitter, Facebook, LinkedIn and Instagram