The Legislative Finance Committee has begun a long week of hearings in Santa Fe, which will be the committee’s last meeting of the year and the run up to the LFC budget recommendations expected in early-January. This morning, the committee learned consensus revenue estimates - the projected bottom line for the upcoming legislative session.
Updating projections last made in August, Dr. Tom Clifford, Secretary of the Dept. of Finance and Administration (DFA), reports a generally positive revenue outlook. FY 13 revenue is $52 million more than what was forecast in August, while FY 14 recurring revenue is $84 million greater than August projections. Strong oil and gas and personal income tax growth are parts of the reason, though oil and gas revenues are always considered to be volatile.
The projections for FY 15 are more sobering – a $3 million decrease from August projections. The new money forecast is for $293 million.
Secretary Clifford cautions that there is already a lot of pressure on this new money, including the anticipated lottery scholarship shortfall, settlements of union lawsuits and IT requests. He predicts “there is not a lot of room for expanding current spending.” The Martinez administration will also want to replenish reserves to the 10 percent level, up from the current level of 9.3 percent.
General Obligation Bond capacity, which is the preferred funding source for higher education capital projects, is estimated at $167 million, slightly up from August. Severance Tax bonding capacity for new projects is estimated to be $184.8 million, once previously authorized project funding and legislative earmarks are subtracted.
Higher Ed Budgets
On Tuesday, Dec. 10, the LFC will hear the budget requests of higher education institutions and the Higher Education Dept. as well as the UNM Health Sciences Center. There will also be an update on lottery scholarship solvency.