Revenue Forecast Anticipates Increase in General Fund Revenue for FY 2014 and 2015

Uncertainty in Washington, D.C. causes caution in spending
Augusta, Maine - The Maine Revenue Forecasting Committee (RFC) met today to discuss the fall economic forecast due to the Governor and Legislature no later than December 1, 2013.

The formal report will not be released until sometime next week. But at the meeting today the committee publicly indicated a forecasted General Fund revenue increase of approximately $12.86 million in fiscal year 2014 and $7.77 million in fiscal year 2015.


“This is a sign that the economy is improving, but there is much more work to be done,” Governor Paul R. LePage said. “Maine still faces many challenges, and we will continue to push for fiscal responsibility and long-term stability.”

State Finance Commissioner, H. Sawin Millett Jr. is cautioning legislators about the anticipated increase in revenue, particularly given that the changes made in this forecast are relatively small and lack the benefit of information that will be available to the RFC when they meet for the next forecast in March 2014.

“While a positive development, the RFC’s forecast for the current biennium comes on the heels of a $58 million downward projection from May 2013 and continuing uncertainty surrounding future fiscal policy at the federal level,” said Commissioner Millett. “I believe the revenue forecast due in March 2014 will provide a more telling picture of revenue projections over the balance of the biennium, as that report will contain the information on sales tax receipts from the holiday shopping season and the final estimated tax payments made by individual and corporate filers.”

At the meeting today, the RFC also forecasted a revenue increase from their March 2013 report of approximately $8.8 million total in fiscal years 2016 and 2017. The forecast for the Highway Fund includes an estimated increase of $1.65 million for fiscal years 2014 and 2015, as well as an increase of $1.87 million for fiscal years 2016 and 2017.

“Today’s revenue forecast reflects the slow economic recovery that Maine and most of the nation are experiencing,” said Dr. Michael Allen, Associate Commissioner for Tax Policy. “Continued uncertainty on the federal level relative to the ongoing discussions in Washington on the budget, sequestration and debt ceiling is causing businesses and consumers alike to be more cautious about how they spend their hard-earned money."

The RFC consists of the State Budget Officer, the Associate Commissioner for Tax Policy, the State Economist and an economist on the faculty of the University of Maine System selected by the chancellor, the Director of the Office of Fiscal and Program Review and another member of the Legislature's nonpartisan staff familiar with revenue estimating issues appointed by the Legislative Council.