MONTPELIER, Vt. (AP) — Vermont’s twice-a-year revenue forecast is being revised downward, with a $10 million reduction in collections expected in the just-started fiscal year and a $20 million reduction in the fiscal year that starts next July, two consulting economists told lawmakers Friday.
“Although the U.S. and Vermont economies are actually growing again … and both continue to make progress towards regaining the jobs lost during the ‘Great Recession,’ the pace of progress has slowed,” Jeff Carr of Williston-based Economic and Policy Resources Inc. said in his report.
He and Thomas Kavet of Williamstown-based Kavet, Rockler & Associates both said a recovery expected to be fully under way by 2013 may take until 2014 or 2015 to come to fruition.
They made their presentation to the state Emergency Board, which comprises the governor and chairs of four legislative money committees. The group gathers twice a year to get a report on economic conditions and a forecast for how much the state should expect in tax revenues.
Gov. Peter Shumlin congratulated Carr and Kavet for their record of accuracy in past forecasts. Preliminary year-end figures show the state ended its fiscal year in June having collected $1.197 billion into its general fund in fiscal 2012. Kavet and Carr had predicted in January that the state would collect $1.192 billion, meaning their forecast underestimated revenues by about $5 million, or 0.4 percent.
The slow pace of the recovery is tied to continued economic uncertainty in Europe and disagreements over budget policy in Washington, the men said. They said Vermont’s housing market appeared to have bottomed out and that prices should be climbing slowly in the next couple of years.
They also said there were some bright spots in the performance of state revenues. Kavet said the state’s rooms and meals tax had met its forecast despite the fact that ski resorts had been hurt by a winter with little snow.
