Increasing Inaccuracy of State Revenue Estimates

Every year, every state projects upcoming state tax revenues. It matters a lot. These estimates are used by legislators, technocrats, and the governor to determine spending for schools, health care, and agency or program in government. Sometimes, when states are on a biannual budget, spending must determine spending for two years. Imagine trying to estimate […]

Iowa Projected Revenues Up Again

As expected, the Iowa Revenue Estimating Conference are estimating higher state tax revenues for the current and next year than previously thought. Last year, I predicted these revenue estimates would be underestimated. These models tend not to predict changes in the economy, so they tend to overestimate revenues during recessions and underestimate revenues during economic […]

REC Estimates for Fiscal Year 2011

The Revenue Estimating Conference published their December predictions for fiscal year 2011 (July 2009 – June 2010). We know the margin of error for REC net revenue predictions for the following year 3.9%–higher than the ideal margin of error. REC revised, downward, their prediction to $5.403 billion in net revenues. Given their historical accuracy it […]

Accuracy of Iowa’s Revenue Estimating Conference

A lot of people have been paying attention to the Revenue Estimating Conference (REC) the last two years. By law, REC meets three times a year–March, October, and December–to forecast tax revenues for the next fiscal year (between July and June). The legislature and governor use the estimates to determine expenditures…