UPDATE: House appropriations chairman Fred Romkema, R-Spearfish, said the schedule has indeed changed and there won’t be a decision today on an official revision of the 2013 revenue estimate and an official forecast for 2014 revenue. “We’ll adopt those Monday morning — Monday morning,” he said. A subcommittee will work this morning on a recommendation, he said.
Fred Schoenfeld, the chief fiscal analyst for the Legislative Research Council, and right-hand man Aaron Olson presented their revenue estimates this morning to the Legislature’s Joint Committee on Appropriations. Schoenfeld said they again are using the trends method, which is different than what the Bureau of Finance and Management does. “This approach has produced good results over the last couple of years,” Schoenfeld said, adding that the alternative methodologies work well. “It adds confidence to the overall forecast.” He cautioned that in an upward business cycle the LRC forecasts might be low. You’ll see in the numbers below that generally the two sets of numbers are very close, other than LRC forecasting about $5 million more in sales tax for FY14. What this means is that both sets of budget staff agree that the rest of 2013 and 2014 will be better but softer than the standard pace for South Dakota’s economy pre-recession and pre-crash. Olson described the differences between LRC and BFM generally as ”minimal.” While LRC doesn’t specifically break out a number for video lottery on its hand0ut for the committee, Olson said LRC sees a 5 percent growth in video lottery for FY14; that is approximately the same as the BFM estimate.
Sales and use tax FY13– BFM $773.8 million; LRC $774.3 million.
Sales and use tax FY14 — BFM $802.99 million; LRC $807.9 million.
Contractor’s excise tax FY13 — BFM $84.2 million; LRC $84.2 million.
Contractor’s excise tax FY14 — BFM $89.55 million; LRC $88.39 million.
Bank franchise tax FY13 — BFM $22.9 million; LRC $22.9 million.
Bank franchise tax FY14 — BFM $23.2 million; LRC $23.2 million.
Insurance tax FY13 — BFM $68.5 million; LRC $69.9 million.
Insurance tax FY14 — BFM $71.3 million; LRC $72.2 million.