Top financial experts presented an optimistic economic outlook to a panel of lawmakers that will forecast revenue projections that will be the basis of the state budget.
Thursday’s meeting of the Joint Economic Outlook and Revenue Assessment Committee is part of the run up to the 2014 legislative session that kicks off Monday.
The 18 members of the committee heard from state economist Derek Santos, budget and policy analyst Cathy Holland-Smith, new Idaho Department of Finance Director Ken Edmunds and economists from three state universities.
“This is the famous recovery that wasn’t there, but the good news is we expect it to pick up speed,” Santos said.
Experts testified that Idaho’s rainy day savings account is maxed out, unemployment is down, personal income is up, state revenue is up and consumer spending is expected to accelerate.
“Times are improving, but they’re not great,” Idaho State University economist Scott Benson said. “(This is not) the time to say we better batten down the hatches and hunker in.
“The economy is poised to continue growing and support growth rates,” Benson continued.
The university economists offered the first major revenue projection as lawmakers prepare to set the fiscal year 2015 budget in the coming months. They forecast revenue growth at 5.6 percent above this year’s level.
On Monday, Gov. Butch Otter will offer his own budget request and revenue forecast, while members of the revenue committee will issue their own projection next week.
Revenue projections are important to Idaho schools because budget writers will use them when they set the K-12 public schools budget. Public schools are the state’s largest expense, and account for about 47 percent of general fund spending.
Superintendent of Public Instruction Tom Luna is requesting a 5.4 percent increase in K-12 funding for next year.
Bob Fick, an Idaho Department of Labor spokesman and researcher, said a number of indicators point to a healing economy.
“It’s picked up substantially in the last year,” Fick said.
In recent years, members of the economic outlook and revenue committee have undercut revenue projections in favor of a more conservative budgeting approach. In each of the last two years, all 18 committee members projected lower revenues than the state ended up collecting.
Last year, Sen. Dan Schmidt, D-Pocatello, offered the most accurate revenue projection, thoughit came in $71.2 million below collections, missing the mark by 2.6 percent.
The committee will meet again today in the Statehouse’s Lincoln Auditorium. The group’s final meeting is set for Thursday afternoon, when the panel is expected to finalize its revenue projection for the 2015 budget year.