Council on Revenues Lowers General Fund Growth to 4.2 Percent
The State’s General Fund forecast for the current fiscal year was lowered less than one percentage point today, meaning there’s less money to spend in the upcoming legislative session.
The Council on Revenues lowered its State General Fund growth forecast from its previous 5 percent to 4.2 percent. That lowers state spending by about 80-million dollars. But, Council member Chris Grandy says growth is a lot higher.
“From my perspective, visitor arrivals and expenditures are growing still higher, above average. Contracting tax base has come up, Real GDP growth has been accelerating. So, for me, the economy looks pretty good. I’m at 6.5 percent.”
Professor Carl Bonham, who’s a member of the Council and executive director of the UH Economic Research Organization, was asked if the federal government shutdown would have a major impact on state revenue collections. Bonham said he did not do the math but offered this possible outcome.
“I also don’t expect it to continue to go on and on and on. We already have 2 or 3 federal employee unions suing the administration. I think they have a very strong case because, essentially, their employees are being forced to work without pay. I don’t know how that’s gonna play out but if we miss one paycheck, I think the impact will be relatively minor, if we miss 3 it will be large-er.”
Bonham says the current slowdown in tourism could be reversed but member, Kristi Maynard, offered a projection which was seconded by vice chair Marilyn Niwao.
“(Maynard)I don’t think we’re gonna stay at an unusually high number. I’ll make a motion that we change the forecast to 4.2 (Niwao) Okay, I’ll second that motion.”
Chair Kurt Kawafuchi then called for a vote.
Call for a motion for 42 and a second. Take a vote. One against, four in support.
The next Council on Revenue general fund forecast is scheduled for March 12th one day before the state budget crossover in the legislature. Wayne Yoshioka, HPR News.