From rags to riches: State coffers flush from federal aid and unexpected rise in tax revenue
Crain’s New York Business
New analysis by the Citizens Budget Commission underscores this new reality, as the CBC argues that the state will run a $5.9 billion surplus in the next two fiscal years and that updated tax revenue estimates and federal aid money promises offset at least 94% of the $61.8 billion revenue shortfall initially projected for the next four years.
“We really aren’t in the hole we thought we’d be, at all,” said Andrew Rein, president of the CBC. “The starting point is a heck of a lot better than any of us imagined, even a few months ago.”
Tax receipts in the next four fiscal years are estimated to be $32.6 billion higher than projected, according to the CBC, which will eliminate 53% of the anticipated revenue shortfall; $23.8 billion in federal relief from the American Rescue Plan Act will cover the other 42% of those projections.
“And that’s a conservative estimate because there’s more money in other pots,” Rein said.
The CBC called the passage of the $1.9 trillion relief package “a game changer for New York state” even as the Legislature in Albany debates adding tax increases on the wealthy into a fiscal 2022 budget, which could further pad the state’s coffers.