June Monthly Fiscal Highlights for the State of Arizona
Republished with permission from Senator John McComish, Representative Bob Robson and Representative Jeff Dial (Legislative District 20)
This month’s report focuses on the preliminary FY 2012 year-end estimates. The state continues to process some transactions through the end of July and after this period it will take several months to confirm year-end adjustments and to officially determine the state’s fiscal year ending balance. Among the key points of the document:
- General Fund base revenues for all of FY 2012 grew by 6.3% and were $145 million above forecast. All 3 major revenue categories grew by at least 6.0%.
- FY 2012 General Fund spending was $112 million less than expected. The AHCCCS childless adult enrollment freeze reduced caseloads more quickly than anticipated and K-12 enrollment grew by only 0.7% (compared to the budgeted growth of 1.2%).
- With $145 million in unanticipated revenue and $112 million in lower than expected spending, we currently project that the FY 2012 ending balance will be $257 million higher than budgeted.
- Since the enacted May budget presumed a $122 million FY 2012 ending balance, the $257 million in added resources would result in a projected FY 2012 ending balance of $379 million. As noted above, this is an estimate and subject to change.
- The 3 year budget projections associated with the enacted May budget assumed that there would be substantial year-end balances in FY 2012 and FY 2013 followed by a $(486) million shortfall in FY 2015 with the expiration of the 1 cent sales tax and the expansion of federal health care.
- The unbudgeted FY 2012 gain of $257 million would help reduce this long-term shortfall.
- It is important to note that the 2013-2015 budget planning includes $450 million in the Budget Stabilization (Rainy Day) Fund.
- The long term estimates will also be affected by other major unknowns, including the general state of the economy, the possible reduction of federal defense and discretionary spending as part of the federal deficit discussion, and the uncertainty regarding the federal health care expansion.
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AZBio extends its appreciation to Senator John McComish, Representative Bob Robson, and Representative Jeff Dial for providing this summary so that it can be shared with our AZBio community and for their service to our State.