The Joint Economic Outlook & Revenue Assessment Committee has 14-3 voted to adopt Gov. Brad Little’s revenue projection for the current year of 6.1% revenue growth, but then voted 11-6 to undercut the governor’s baseline projection for the coming year, fiscal year 2021, by $23.1 million. That’s a difference of just a fraction of a percentage point; Little’s baseline projection was for 4.7% growth next year, though he only proposed spending 3.75% more.
The committee's revenue figure of $4.1255 billion shows 4.1% growth next year; that's actually only $3.1 million below the governor's composite weighted average forecast, which combined three scenarios.
“We’re erring on the side of caution,” said Sen. C. Scott Grow, R-Eagle. “We certainly respect the governor’s recommendation.”
The difference, in a $4 billion budget, is nearly infinitesimal.
Here's how the debate and votes went:
First, Sen. Mark Nye, D-Pocatello, moved to adopt the governor’s projection for the current year, fiscal year 2020, of $3.9613 billion, or 6.1% growth, and Sen. Grant Burgoyne, D-Boise, seconded the motion. Committee members noted that the governor’s projection, released on Monday, is $32 million more than the administration’s previous project, released in August; that’s because revenues, and particularly corporate income tax revenues, have been coming in higher than projected. Committee members noted that when they set their projections last week, they didn’t have that new information.
Rep. Steven Harris, R-Boise, said, “It would make sense to me, as well, if we have the most information as possible before.” However, he said, “We did seek quite a bit of information over many hours. … We had a lot of information, even from the same sources the governor listens to.” He then moved to adopt a considerably lower figure for the current year, at the average of the committee members’ projections last week: $3.9357 billion, or 5.4% growth. Sen. Dean Mortimer, R-Idaho Falls, seconded Harris’ motion.
Burgoyne said, “The differences don’t amount to much. They’re pretty small considering the number of dollars that we’re talking about. But I’ve been on this committee for approximately 10 years, and this is what I’ve kinda concluded: There aren’t very many people around here when it comes to making estimates that do a better job than the governor’s office and DFM.” He added, “JFAC’s going to take a look at it later, and they’re going to have more information, so it’s a refining process. … I find it hard to find a basis for disagreeing with the governor on this.”
Harris’ motion was voted on first, and failed, 6-11; the only votes in favor of it came from Harris, Mortimer, and Reps. Wendy Horman, Gary Collins, Rick Youngblood, and Gayann DeMordaunt. Nye’s motion then passed 14-3, with just three “no” votes from Sens. Kelly Anthon and Mortimer and from Harris.
The committee then moved on to the coming year: Fiscal year 2021. Nye again moved the governor’s recommendation; this time, Anthon seconded his motion. Mortimer again moved the average of the committee’s estimates from last week, $4.1255 billion, and Rep. Wendy Horman, R-Idaho Falls, seconded the motion. Mortimer said he favored “a more conservative approach, even though it is minor.” The motion essentially removed most of the increase the governor’s economists added with the new, updated forecast based on actual revenues since August.
Added Harris, “No harm in being careful. That money that comes in beyond the recommendation isn’t going anywhere.”
Grow said, “My concern is the next year, we need to be cautious. … I’d rather have us be on the safe side.”
Burgoyne noted that in two days of extensive testimony from economic and industry experts and others, the joint committee didn’t hear any testimony that a recession is likely in the next year. The governor’s forecast, in only the “pessimistic” of its three scenarios, forecast a very mild, three-quarter recession in 2021.
Anthon said, “I’m willing to support either of these figures – they’re very close.”
Mortimer’s motion then passed, 11-6. The only “no” votes came from Sens. Steve Bair, Burgoyne and Nye and Reps. Clark Kauffman, Elaine Smith and Sally Toone.