UNCG Budget Central

May 2012 Fiscal Research Division General Fund Revenue Report & Economic Outlook

The General Fund Revenue and Economic Outlook Report for May 2012 developed by the Fiscal Research Division of the General Assembly can be seen here.  This report is an update provided by the General Assembly’s Fiscal Research Division that summarizes revenue for the current fiscal year and outlines the risks to revenue receipts for the current year.  

The following is an excerpt from the report: 

The State’s economy is following the path of a slow, steady recovery. Advancements in the economy have improved the revenue picture for this fiscal year leading to an estimated $232.5 million surplus. However, a downgrade in economic expectations for FY 2012-13 resulted in a relatively small adjustment to next fiscal year’s forecast. While there are plenty of reasons to be cautious about next year’s revenue forecast, there seems to be more positive news than negative released each month. This would suggest the economy is gaining momentum. Nonetheless, the slow growth scenario is expected to persist into 2013. Until a stronger economy is established, the current upturn remains fragile. So far, the economy has been able to pull through the negative shocks of the last two years and continue along its slow, upward climb. The potential economic trouble in Europe remains the biggest threat to the momentum that has been building over the last 5 to 6 months.

General Fund Revenue Report & Economic Outlook

Governor Perdue’s Proposed FY 2012-2013 Budget and Beginning of the 2012 Legislative Session

On Thursday, May 10, Governor Bev Perdue released her proposed 2012-13 State Budget. The proposal is an adjustment of the second year of a two-year budget the legislature approved in 2011 over her veto. Below is a side-by-side comparison of the UNC System’s Short Session Budget Priorities and the Governor’s proposed budget recommendations.

Side-by-Side of Governor’s Recommended 2012-13 Budget to UNC System Budget Priorities

On Wednesday, May 16, the North Carolina General Assembly will convene for the 2012 Legislative short session. The General Assembly will be making adjustments as necessary to the state budget they passed in 2011. 

More Information from Governor Perdue’s Office About the Recommended Budget:

2012-13 Governor’s Budget (UNC System begins on page 31)

Governor Perdue’s Budget Highlights on Education

News Coverage:

Gov. Bev Perdue to seek more school funding, sale tax hike in budget by the News and Observer

Perdue budget would raise sales tax, increase education spending by WRAL.com

How Does UNCG Fit into the State Budget Process?

The Budget Education Committee of the UNCG Staff Senate will be hosting a presentation featuring Director of Strategic Initiatives, Mike Tarrant. Mike will talk with staff and faculty about the State budget process, how it works, and how UNCG receives state funds as part of the overall state budget. Please come prepared with questions.

How Does UNCG Fit into the State Budget Process? Presented by Director of Strategic Initiatives, Mike Tarrant

Date: Tuesday, May 8, 2012
Time: 2:00 – 4:00 PM
Location: Room 120, School of Education Building

April 2012 Consensus Revenue Forecast – Revenues Up $232.5 million for Fiscal Year 2011-12

The Fiscal Research Division and the Office of State Budget and Management have reached a consensus on a revision to the FY 2012-13 revenue forecast. The consensus revenue forecast for FY 2012-13 was revised upward by $21.0 million and projects $232.5 million in over-collections for the current fiscal year.

There are two key reasons for the small adjustment to next fiscal year’s forecast despite the increase in the revenue projected for this fiscal year. For one, there was only a moderate upgrade to the overall collection base, and secondly, the economic forecast for the rest of 2012 and into 2013 was downgraded from the original biennium forecast of last year. 

The revenue surplus projected for FY 2011-12, is the direct result of better than expected growth in personal income tax withholding collections . Other key revenue sources including the Sales Tax, Corporate Income Tax, and Franchise Tax are expected to be at or slightly below their original revenue projections.  Additionally, there was no “April surprise” again this year from personal income non-withholding (capital gains, business income, etc.). This means that the overall tax base only grew a moderate amount over the original biennium budget projections.

The second reason for little change in the FY 2012-13 forecast despite a slightly larger tax base is the downgraded economic forecast for the nation and the State’s economy compared with what was originally envisioned for the upcoming fiscal year. The net change in FY 2012-13 baseline revenues (removing tax law changes) was a reduction from 4.6% year-over-year growth, as forecast in April 2011, to 4.2% growth.

As a final note, the end-of-year revenue estimates produced after April collections usually fall within a range of plus or minus $10 to $20 million of the projected amount. A little more volatility will be in play this year given the newly enacted $50,000 business income exemption, which started with the 2012 tax year. The business exemption has added another layer of uncertainty for this year’s estimates because of how taxpayers with business income may, or may not, adjust their June 2012 estimated payments. 

Source: NC Fiscal Research Division, Email from Legislative Economist Barry Boardman to legislators and staff members

General Fund Revenue Report & Economic Outlook February 2012

The General Fund Revenue and Economic Outlook Report for February 2012 developed by the Fiscal Research Division of the General Assembly can be seen here.  This report is an update provided by the General Assembly’s Fiscal Research Division that summarizes revenue for the current fiscal year and outlines the risks to revenue receipts for the current year.  

Through January, tax revenue is $145 million above the forecasted revenue target for the 2011-2012 fiscal year. Recent economic data indicate the recovery is slowly regaining the traction lost this past summer and fall. Global economic risks continue to threaten the recovery, particularly rising gas prices and the Eurozone’s debt problems.

General Fund Revenue Report & Economic Outlook