State fiscally stable, latest estimates predict
After last week’s meeting of revenue estimators in Kansas, the news appears to be good for those seeking fiscal stability.
“Over the past several years, sometimes, big, big changes up and down have been forecasted,” said Kansas Association of School Boards Vice President for Advocacy Mark Tallman. “We’re usually here talking about how it has changed from the last estimate. This time, over that full three year period, they’re basically saying revenues will be up about $15 million more than expected, which is, for all practical purposes, a rounding error.”
Tax revenues will be up over $100 million, but most of that is being paid back to KPERS thanks to legislative action earlier this session, since the state missed a payment during the budget scrambles late in the Brownback administration.
“The experts will always tell you, it’s very difficult to look that far out,” said Tallman. “Should there be a major economic change, a recession, obviously, that they’re not seeing coming at this point. If, for Kansas, the trade war would get worse, if there would be a major energy shock, there are obviously a number of things which could change this, but, based on what they’re seeing now, these are state economic experts, looking also at national trends, they’re saying things continue to look pretty good.”
According to the estimators, personal income is actually expected to go up in the time they measured between now and the end of 2021.
“How much does everyone in the state make in a given year is expected to grow over the next three years and grow at a higher rate than anytime since 2013,” said Tallman. “We went through a period of time of very low income growth in the state. That appears to be getting better, and that’s positive news. That doesn’t automatically translate into better state revenue growth, but if your underlying economy isn’t doing well, your state tax revenue is not going to do well.”
Tallman’s latest blog post notes that even after significant increases in school funding beginning in 2018 and continuing under the five-year funding plan passed last session, total K-12 expenditures as a percentage of state personal income are expected to remain well below most years in the 2000’s.
