State revenue advisory group to meet, during a time of volatility in oil
In the wake of volatile oil prices, the state’s “Revenue Advisory Committee” will meet later this month, to assess the state’s economy, and prepare for a revenue forecast.
That forecast will help as agencies and Gov. Doug Burgum prepare an executive budget proposal for the upcoming Legislative session.
The committee will hear from the state’s financial consultant – Moody’s Analytics – as well as industry leaders, about the state’s economic conditions.
"It seems on the one hand like a horrible time to be doing a revenue forecast, when there's so much uncertainty," said Office of Management and Budget director Joe Morrissette. "On the other hand, it's a good time to do a forecast, because we need to take a look at the future."
Morrissette said Moody's will provide a more global look at where supply and demand will take oil prices.
"There are certainly challenges ahead," Morrisette said. But he said it’s still too early to make any firm budget decisions, because things are still very volatile.
"We know from experience there is a lag between when (oil) price drops and production is affected," Morrissette said. "Our production is still at a healthy level, still above forecast, and that gives us a little bit of a cushion."
Morrissette says in terms of oil tax collections, they have tracked above forecast for the first eight months of the biennial budget period.
We've exceeded forecast by about $80 million," Morrissette said. "That gives us a little bit of a cushion to absorb the little bit of decline."
That committee meeting is scheduled March 19th.