June Revenue Forecast Brief
The good news is that continued economic growth and factors related to federal tax law mean Colorado will have more resources available for much-needed public investment over the next fiscal year. But indications show that revenue growth will begin to slow after that, according to the quarterly revenue estimates recently released by Colorado Legislative Council.
The Colorado economy continues to expand, as strong employment is supporting consumer spending. The estimated expansion means $1.1 billion more for public investments in the fiscal year that starts July 1 than the amount budgeted for the previous year. The General Fund revenue estimate for FY 2012-13, the fiscal year that ends on June 30, 2013, was revised upward by $472.9 million from the March estimate and the FY2013-14 estimate was revised upward by $227.7 million. The state is getting closer to the TABOR rebates than previously anticipated. A large part of the optimistic forecast results from gains in employment, wages, consumer spending, and home construction activity. The economy, however, still faces some head winds from federal spending cuts that will reduce public and private sector employment.
Key Points from the June 20 Quarterly Revenue Estimates
- Colorado will have $1.1 billion or 12.2 percent more tax dollars, also known as General Funds, in FY 2014-15 than appropriated in FY 2013-14
- FY 2012-13 General Fund revenue revised upward by $473 million from the amount expected in March. Much of this increase was one-time money resulting from investors selling assets before the January 1 federal tax increase on capital gains.
- FY 2013-14 General Fund revised upward by $227.7 million on the enhanced economic expectations.
- Revenue subject to TABOR is expected to be below the Referendum C cap in FY 2014-15 by $191 million.
- The FY 2012-13 surplus of $1.1 billion will be transferred to the State Education Fund
- The Colorado economy continues to expand as the unemployment rate in April fell below 7 percent for the first time since January 2009. Real estate markets and consumer spending in Colorado continue to show promising trends.
