State analysts now expect that the COVID-19 pandemic has had a smaller effect on state revenue than previously estimated. The state now expects to collect 97% of what it collected last year. And it also expects to receive 93% of that amount in the year after.
Between federal relief efforts and savings agreed upon earlier this year, lawmakers report that not much will have to be cut for the upcoming budget. They may have some tough decisions to face when federal money runs out, however.
Over the next year, lawmakers ought to negotiate about how they can live within their means. We’ve already offered some ideas for how they can save money; they’re available here. The legislators elected in the fall may have different priorities. Other officials, like the state budget director, do not want to reprioritize anything.
Whether lawmakers agree to save money, go into debt, or as a raise taxes depends on what citizens will tolerate. A general expectation that increasing financial burdens — or future burdens — on the population is inappropriate will be enough to get lawmakers to agree that they can find ways to save money.
Lawmakers argue about how to spend the limited tax dollars collected from residents and businesses every year. That duty doesn’t change if the number goes down due to the pandemic, and lawmakers ought to expect to cut the budget instead of going into debt or raising taxes.
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