The State Funding Board heard revenue estimates today from a variety of different economists around the state. While the range of the cuts differed, most predicted that the economy will finally start turning around towards the middle of next year. For this year though, the news is grim. Finance and Administration Commissioner Goetz told us the range for cuts this year will be between $700 million and $1 billion. As Goetz noted during his presentation of preliminary November tax collections, the decline of state revenues has accelerated. That’s why these budget cut numbers keep getting bigger.
Needless to say, the meeting was filled with troubling news. Tennessee is third worst in the nation for tax collections in the country right now. That’s perplexing to state leaders, because the other two states above them are Florida and Arizona, which are both dealing with the collapse of the real estate market.
There is some hope that the economic stimulus package floating around Washington D.C. will actually become a reality soon and send some cash our way. What economists don’t know, is how this will play out locally, because there’s really no precedent here.
