Maine’s revenues, in the face of COVID-19, have surpassed downgraded expectations by $154.3 million, or 6.6%, for the first seven months of fiscal 2021, according to the Department of Administrative and Financial Services.
Revenues for January were about $90 million more than the nonpartisan, independent Revenue Forecasting Committee anticipated, DAFS Commissioner Kirsten Figueroa said.
Adjusting for the increase in the rate of revenue sharing to local cities and towns, when compared to the same seven-month period last fiscal year, general fund revenues are up by 4.7%.
Increased federal funding, Gov. Janet Mills’ targeting of coronavirus relief funds and the state’s relative success in fighting the pandemic have helped stabilize the budget, Figueroa said.
Mills has proposed an $8.4 billion, two-year state budget. Lawmakers must enact a budget by June 30. Revenue forecasts helps establish benchmarks for spending.
The state is not yet out of the woods, according to Figueroa.
“We will continue to closely monitor the state’s fiscal health, prioritizing Maine’s pandemic response and the programs crucial to Maine people during these times,” Figueroa said. “Though these revenue figures are promising, we remain cautious and will continue to monitor developments closely.”
State officials will review reports from the Consensus Economic Forecasting Commission and Revenue Forecasting Committee, due April 1 and May 1, respectively. Both identify long-term trends as well as the short-term picture.
Reflecting a national trend, restaurant and lodging taxes were the only categories showing significant declines.
“We, like the rest of the nation, were dealt a bad hand last year,” Mills said in an address to lawmakers. “But we are pushing through.”
S&P Global Ratings and Moody’s Investors Service rate Maine’s general obligation bonds AA and Aa2, respectively. Both assign stable outlooks.