Little change in revenue forecast ahead of budget proposal
NEW CASTLE, Del. (AP) — Delaware’s official government revenue forecast for the upcoming fiscal year has ticked up only slightly from previous estimates as Democratic Gov. John Carney’s administration prepares to roll out a proposed budget.
The $4.3 billion revenue projection approved Monday for fiscal 2019 is up about $24 million compared to September’s estimate due to higher projections for abandoned property collections.
The revenue projection for the current fiscal year dropped by $200,000 from September, an inconsequential change in a $4.24 billion estimate. A $25 million increase in estimated abandoned property collections and a $6 million increase in projected gambling revenues were offset by decreases in other revenue categories.
Monday’s projections are the final updates from the Delaware Economic and Financial Advisory Council before Carney unveils his budget proposal for fiscal 2019 in mid-January.
Carney’s budget director, Mike Jackson, said the latest figures suggest that a package of tax increases enacted by lawmakers earlier this year has helped stabilize Delaware’s economy. After accounting for tax and fee increases in the legislation, revenue estimates for next year have grown by an additional $87.6 million, or slightly more than 2 percent
“What we’re realizing is 2.1 percent revenue growth into fiscal year ’19 that is beyond the revenue changes that were enacted,” said Jackson, adding that officials will continue a cautious budget approach.
“I think we are focused as an administration on building a sustainable plan going forward that meets the requirements to support core government services and minimizing growth to where it is sustainable in the out years,” he added.
Jackson declined to say whether Carney’s budget proposal for fiscal 2019, which starts July 1, will include further tax hikes.
Meanwhile, officials will continue to keep a close eye on existing revenue sources, including volatile abandoned property collections.
Officials suggested that bumps in abandoned property estimates for this year and next year that were approved Monday are due in part to a temporary slowdown in issuing refunds to claimants because of a new approval process aimed at preventing data breaches and identity fraud.
Looking at other revenue, officials said retailers and consumers may have stocked up on booze ahead of an increase in alcohol taxes enacted this year, resulting in a lowering of estimates for that revenue category on Monday.
On the other hand, a bad year for sports bettors has been good for the state, which has seen its take from parlay bets on NFL games increase fourfold from last year to more than $9 million. State finance officials attributed the windfall to favored teams not beating the point spreads set by oddsmakers as much as they did last year.
“People tend to bet that the favorite is likely to beat the spread,” explained state finance secretary Rick Geisenberger.