State revenues continue to build a 'cushion' for the 2021 Legislature
November’s revenue collections were slightly behind forecast.
Driving that were sales tax and individual income tax.
But North Dakota’s budget director said that could be more of a timing issue than anything. Joe Morrissette said that’s because the last days of the month of November fell on a weekend.
"As the businesses make those payments and deposits, they typically make the payments on the last calendar day of the month," Morrissette said. "And when that day falls on a weekend, those collections are, for the most part, accounted for in the following month."
Morrissette said that’s reflected in the numbers he’s seeing so far for December.
"The december collections are tracking significantly above the forecast targets for the month," Morrissette said.
For the current biennium, tax collections are still running about 4.9 percent above forecast.
Morrissette said it appears the state is building a nice cushion for the 2021 Legislature. He said when the Legislature adjourned, it had projected a $44 million ending fund balance, and that would be below the threshold for refilling the state’s budget stabilization fund. That fund had been tapped to help balance the budget.
"But as it looks now, because the prior biennium finished so strong, and we were able to put so much into the budget stabilization fund than the Legislature was anticipating at that time, it looks like that fund will be filled up to the maximum statutory limit of 15 percent of appropriations by the end of the biennium," Morrissette said. "That will allow the ending fund balance in the General Fund to be available for appropriation by the Legislature."
Morrissette said he expects that cushion to build.
"There were several very conservative aspects to the Legislative forecast," Morrissette said. "We expect to continue to exceed that for the rest of the biennium."