Quick summary of February 2016 State Revenue Forecast
The Office of Economic Analysis presented its latest projections of the state’s economy and revenue income this week. The team of Mark McMullen and Josh Lehner were upbeat about the near term and cautious about the longer term (economists always have another “hand”).
- The U.S. economy is still in expansion; initial unemployment claims are trending sharply down, but industrial production is weak.
- In Oregon, non-farm employment is growing, which translates into stronger and broad-based income gains. Employment in most regions is growing, and this is pulling workers back into the labor force. Personal income tax collections remain healthy, while corporate taxes are turning downward (including capital gains).
- Oregon weekly Powerball sales surged, as did tobacco sales (likely an indication of more dispensable income – or the billion dollar jackpot).
- Since the December forecast, net general fund resources are up $36 million (0.2 percent), and lottery resources are up $24.8 million.
- There is still no personal kicker projected for 2017. On the other hand (economist-talk), $34.3 million in corporate tax revenue is projected to be dedicated to K-12 education spending in 2017-19.
- A bit of good news for counties: video lottery sales surged. As a consequence, AOC is lobbying for an upward adjustment to the 2015-17 allocation to counties of economic development resources of $1,753 million.
For more information contact Gil Riddell, AOC policy director.