On February 24, 2021, the New York State Assembly and Senate, along with the director of the Division of the Budget, held the 2021 Economic & Revenue Consensus Forecasting Conference Meeting to examine analyses of economic and revenue forecasts for New York State and the nation. The conference is convened annually as a public hearing for the purpose of assisting the Governor and the Legislature in reaching a revenue consensus forecast prior to budget negotiations. Presenters at the conference offer their analyses of the current state of both national and New York State economic conditions, and projections of how current conditions and future conditions may impact state revenues. Presenters at this year’s conference included Chris Varvares of IHS Markit; Hugh Johnson of Hugh Johnson Advisors LLC; Jason Bram of the Federal Reserve Bank of New York; Kajal Lahiri of the State University of New York at Albany; and Jared Walczak of the Tax Foundation.
In addition to the proceedings, the Legislature’s fiscal committees released their economic and revenue analyses of the current fiscal year and the upcoming fiscal year. The differences between the revenue projections put forward by the Legislature and the Division of the Budget provide a starting point for leadership negotiations that will culminate in the release of a joint revenue consensus report in early March. The revenue consensus figures provide a fiscal framework for any spending beyond that put forward in the Governor’s proposed Executive Budget. The Executive Budget projections and the differences proposed by the Legislature’s analyses, exclusive of federal funds, are summarized below:
All Funds Receipts Projections
||State Fiscal Year 20–21
||State Fiscal Year 21–22
|Executive Budget Financial Plan:
|Assembly Majority Ways & Means Committee:
||Executive Budget + $1.669 Billion
||Executive Budget + $3.534 Billion
|Senate Majority Finance Committee:
||Executive Budget + $1.5 Billion
||Executive Budget + $1.9 Billion
The higher revenue projections put forward by the Senate and the Assembly are largely attributed to improved outlooks in personal income tax collections, corporation franchise tax collections and estate tax collections in the legislative economic modeling. All parties forecast robust economic recoveries for New York State in the state’s upcoming fiscal year, and while the state has suffered COVID-19-related impacts beyond those of many other states, projections for the state’s recovery remain optimistic.
The Manatt team will continue to monitor developments as the state continues to craft its 2021–22 state fiscal year budget, and looks forward to providing updates as the process continues.
The proceedings of the conference may be viewed at 2021 Economic & Revenue Consensus Forecasting Conference Meeting.