A legislative committee threw its unanimous support behind Gov. Butch Otter’s revenue budget projections Thursday.
After reviewing financial scenarios and debating numbers for about an hour, the 18-member Economic Outlook and Revenue Assessment Committee accepted Otter’s forecast that the state economy is improving.
Otter and the committee forecast revenues will increase by 6.4 percent for 2014-15. Overall, they set the revenue target at $2.987 billion.
Sen. John Goedde, R-Coeur d’Alene, pushed for the committee to accept Otter’s figure. Goedde also serves as chairman of the Senate Education Committee.
Goedde backed Otter’s forecast after reviewing two years’ worth of projections and noting the difference between them was less than $30 million.
“That’s really close,” Goedde said.
The decision is important because revenue estimates play a big role in shaping the budget the Joint Finance-Appropriations Committee will set.
The decision to back Otter’s forecast was somewhat surprising, since all 18 committee members projected revenue forecasts lower than Otter’s. The median of the committee members’ individual projections came in $50 million lower than Otter’s forecast.
Based on Goedde’s formal motion, the committee went on record calling Otter’s projection “a reasonable forecast,” even though lawmakers pointed out their median forecast was lower.
On Friday, the leaders of the economic outlook committee will report their findings to JFAC.
Chief State Economist Derek Santos said Otter’s projection is based on forecasts that the economy will continue to improve and the housing market is rebounding.
The three big sources of state revenue, which pay for the majority of general fund expenses in the budget, are the individual income tax, corporate income tax and sales tax.
JFAC is not bound by the 6.4 percent projections.
JFAC expects to set its official spending targets on Feb. 12.