The state budget director was off by almost a billion dollars in its projections on tax collections for the fiscal year. But his prediction that the year that ended last week would close in the black was right.
Budget director Tim Keen had predicted several times a positive ending balance for the fiscal year. And the state finished with what he wanted, a small cushion of just under $171 million. Keen said even though tax collections were nearly a billion dollars below estimates, a carryover balance from the start of the year helped: "...about $460 million that we were able to use, along with our underspending in a variety of places to be able to finish the year in the black.”
Keen said he was aiming to leave one half of one percent as an ending balance, so while that small surplus is appropriate, it wasn’t enough to do something his office has done with the last two budgets. “We did not have a balance large enough to trigger a transfer to the rainy day fund," Keen said.
The current balance of the rainy day fund is more than $2 billion. Keen says with tax collections coming in short, underspending especially in Medicaid was key, but he’s warning that lawmakers didn’t put enough money into the current Medicaid program. And he says he “significantly missed” last year’s revenue estimates, he’s revised them down for the new two-year budget.