May 16, 2011

State Treasurer Andy Dillon, Senate Fiscal Agency Director Ellen Jeffries, and House Fiscal Agency Director Mitchell E. Bean today reached a consensus on economic and revenue figures for the remainder of Fiscal Year (FY) 2011, for FY 2012, which begins October 1, 2011, and for FY 2013.

Following today's Revenue Estimating Conference, net FY 2011 General Fund-General Purpose (GF-GP) revenue is projected at $7.524 billion, up $296 million from estimates agreed to at the January revenue conference. Net FY '11 School Aid Fund (SAF) revenue is now estimated at $11.112 billion, up $132 million from January. Combined, GF and SAF estimates are up $429 million for FY '11.

Net GF-GP revenue for the 2012 Fiscal Year is now forecasted at $7.651 billion, up $356.9 million from the January estimate, while the FY '12 SAF revenue estimate has been revised up $142 million to an estimated $11.335 billion.

In FY 2013, GF-GP revenue is estimated at $7.517 billion and SAF revenue is estimated at $11.626 billion.

"While we have seen an up-tick in several revenue areas, the income and sales taxes have shown the strongest increases, as a result of employment gains," said State Treasurer Andy Dillon. "There are some positive economic signs heading into the summer months, but we must continue our efforts to grow jobs and investment in Michigan, to keep the state economy moving forward."

Treasurer Dillon noted several risks to the revenue estimates agreed to today, which include high oil and gas prices. A prolonged spike in energy costs could have a dampening effect on state and national economic growth.

"The revenue estimates agreed to today show positive signs toward economic recovery in Michigan," said State Budget Director John Nixon. "I am encouraged by this news and think it demonstrates that Michigan is poised and ready for a bright and prosperous future. I would caution, however, that the bright future we all desire can only happen if we remain committed to a balanced budget. We must proceed prudently and ensure we achieve long-term structural balance."