by Nat Rudarakanchana May 3, 2013 vtdigger.org The latest revenue projections from the states Joint Fiscal Office show a $16 million surplus by the end of the fiscal year, later in June, which could impact imminent budget negotiations between the House and the Senate.
JFO Chief Fiscal Officer Stephen Klein. VTD/Josh Larkin
Income tax has been strong this year, said Stephen Klein, the groups chief fiscal officer. Overall revenues for April were $26.8 million higher than expected, he said.
Klein appeared before the House Ways and Means and House Appropriations committees earlier Friday, to tell them the latest news, though figures havent been formally released by the administration.
The takeaway is that there could be more money available for reserves.
Back in March, when House Appropriations and the full floor approved the budget, these figures werent available, said Klein. Back then, also, no one knew if there would be a fiscal surplus at the end of the year, he said.
Its more likely now that there will be money for the federal sequestration and for the rainy day fund from the surplus, so it may affect the negotiations on the budget, Klein told VTDigger.
House Appropriations chair Martha Heath, D-Westford, signaled her willingness to stow away lesser reserves in light of the new information to her Senate counterpart, Jane Kitchel, D-Caledonia. Heaths remarks came as a budget conference committee met for the first time, to schedule meetings every day next week.
A surplus could obviate our need for reserves, said Heath at that initial meeting on Friday afternoon. Three members from the two Appropriations committees will bargain over differences in their budget language all of next week.
State senators set aside no reserves in their budget vote earlier this week.
But House Speaker Shap Smith also cautioned at a Friday news conference that rosy revenue forecasts dont necessarily address revenue needs in 2014, even if they comfort lawmakers fearful about the need for reserves.
I dont think were going to be in a situation where we would up the forecast at this point and time in the session, Smith said. So a rosier outlook on revenues doesnt necessarily mean additional spending in 2014, but I do think it might give us some comfort on the issue of reserves.
Under current law, a quarter of any fiscal surplus in June goes toward the states rainy day fund, with another quarter poured into a fund which compensates for cuts in federal funding. Half of any surplus goes to the education fund, and in particular a special property tax relief fund.
Other topics of contention that Heath and Kitchel broached during their brief initial meeting included the Senates more austere take on adding new positions to state government, relative to the Houses decisions. The Shumlin administration asked for 79 new positions: the House bargained it down to 66: and the Senate decided on 58.
The two money chairs also acknowledged differences in the way theyd tinker with the states Reach Up welfare program, a topic of controversy in recent weeks. They plan to start next week by solidifying their agreements, before moving onto more contentious conflicts.
The three members from House and Senate Appropriations on the six member committee are: Reps. Heath, Mitzi Johnson, D-Grand Isle, and Anne OBrien, D-Richmond, alongside Sens. Kitchel, Dick Sears, D-Bennington, and Diane Snelling, R-Chittenden.