2019 Session Revenue and Budget Outlook - Virginiahac.virginia.gov/committee/files/2018/11-13-18...

2019 Session Revenue and Budget Outlook

Robert P. Vaughn, DirectorAnne E. Oman, Fiscal Analyst

House Appropriations Committee

November 13, 2018

Snapshot of U.S. Economy• The U.S. economy is growing, with GDP growth of 4.2% in the second quarter of 2018 and the first estimate of

Q3 2018 posting a gain of 3.5% • National forecast expects GDP to grow 2.4% over CY 2019

• The U.S. economy added 250,000 jobs in October. The 12-month average payroll gain of 211,000 indicates that job growth remains solid

• The current unemployment rate is 3.7%

• Economic activity in the manufacturing sector expanded in September, and the overall economy grew for the 113th consecutive month

• Employment in manufacturing continued to trend up in September (+18,000), reflecting a gain in durable goods industries. Over the year, manufacturing has added 278,000 jobs, with about four-fifths of the gain in the durable goods component

• Strong growth of hours worked and an acceleration in hourly compensation are driving robust gains in wage and salary income, aided further by personal income tax cuts. As a result, economists expect real Disposable Personal Income (DPI) growth to remain strong, registering 2.6% growth in 2018 (Q4/Q4), 2.9% over 2019, and 2.3% over 2020

• Retail sales are expected to grow between 5 and 5.6% from a year ago, according to Deloitte's annual forecast for the holiday season

• Existing home sales were flat in August, remaining at their lowest level in 29 months. Higher borrowing rates and a shortage of houses at particular price points are suppressing home sales. The National Association of Realtors' short-term forecasting index, the Pending Home Sales Index, fell 1.8% in August, sinking to a 46-month low and pointing toward lower existing home sales in September and October

• Higher interest rates, higher construction costs, and shortages of buildable lots are holding housing starts down

1

After Several Quarters of Below 2% Growth, GDP Surged to 4.2% in 2018

2

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

1.9% Average 2015 - 2016

Source: U.S. Bureau of Economic Analysis, Real Gross Domestic ProductionPercent Change from Proceeding Period, Seasonally Adjusted Annual Rate

Percent

2.7% Average2017 – Q2 2018

ISM, Consumer Sentiment, and a Look at National Employment

3

ISM Manufacturing ReportOf the 18 manufacturing industries, 15 reported growth in September

4

Index Series Index Sep Series Index AugPercentage Point

Change Direction Rate of Change Trend* (Months)

PMI® 59.8 61.3 -1.5 Growing Slower 25New Orders 61.8 65.1 -3.3 Growing Slower 33

Production 63.9 63.3 +0.6 Growing Faster 25

Employment 58.8 58.5 +0.3 Growing Faster 24

Supplier Deliveries

61.1 64.5 -3.4 Slowing Slower 24

Inventories 53.3 55.4 -2.1 Growing Slower 9

Customers' Inventories

40.5 41.0 -0.5 Too Low Faster 24

Prices 66.9 72.1 -5.2 Increasing Slower 31

Backlog of Orders 55.7 57.5 -1.8 Growing Slower 20

New Export Orders

56.0 55.2 +0.8 Growing Faster 31

Imports 54.5 53.9 +0.6 Growing Faster 20

OVERALL ECONOMY Growing Slower 113

Manufacturing Sector Growing Slower 25

Consumer Sentiment is Up, Buoyed By a Strong Job Market

5

50

60

70

80

90

100

110

2007

-02-

0120

07-0

5-01

2007

-08-

0120

07-1

1-01

2008

-02-

0120

08-0

5-01

2008

-08-

0120

08-1

1-01

2009

-02-

0120

09-0

5-01

2009

-08-

0120

09-1

1-01

2010

-02-

0120

10-0

5-01

2010

-08-

0120

10-1

1-01

2011

-02-

0120

11-0

5-01

2011

-08-

0120

11-1

1-01

2012

-02-

0120

12-0

5-01

2012

-08-

0120

12-1

1-01

2013

-02-

0120

13-0

5-01

2013

-08-

0120

13-1

1-01

2014

-02-

0120

14-0

5-01

2014

-08-

0120

14-1

1-01

2015

-02-

0120

15-0

5-01

2015

-08-

0120

15-1

1-01

2016

-02-

0120

16-0

5-01

2016

-08-

0120

16-1

1-01

2017

-02-

0120

17-0

5-01

2017

-08-

0120

17-1

1-01

2018

-02-

0120

18-0

5-01

2018

-08-

01

Source: University of Michigan: Consumer Sentiment, Index; Federal Reserve of St. Louis

At 3.7%, the U.S. Unemployment Rate Is at a 49-Year Low and the U6 Rate Is At a 17-Year Low

6

3.7%

7.5%

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

18.0

2007

-01-

01

2007

-05-

01

2007

-09-

01

2008

-01-

01

2008

-05-

01

2008

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2009

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2009

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2009

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2010

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2010

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01

2010

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2011

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2011

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01

2011

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01

2012

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2012

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2012

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2013

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2013

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2013

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2014

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2014

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2014

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2015

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2015

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2015

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2016

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2016

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2016

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2017

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2017

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01

2017

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01

2018

-01-

01

2018

-05-

01

2018

-09-

01

U.S. Unemployment Rate U6RATE

Note: U6 Rate represents total unemployed, plus all marginally attached workers plus total employed part time for economic reasons. Source: Federal Reserve Bank of St. Louis

Employment – Share of Prime Working Age (25-54) Employed is Still 1.5% Below Pre-Recession Levels, But

Has Been Improving

7

83.3%

81.8%

79.5

80.0

80.5

81.0

81.5

82.0

82.5

83.0

83.5

84.0

2007

-01-

01

2007

-05-

01

2007

-09-

01

2008

-01-

01

2008

-05-

01

2008

-09-

01

2009

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01

2009

-05-

01

2009

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01

2010

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01

2010

-05-

01

2010

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01

2011

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01

2011

-05-

01

2011

-09-

01

2012

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01

2012

-05-

01

2012

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01

2013

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01

2013

-05-

01

2013

-09-

01

2014

-01-

01

2014

-05-

01

2014

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01

2015

-01-

01

2015

-05-

01

2015

-09-

01

2016

-01-

01

2016

-05-

01

2016

-09-

01

2017

-01-

01

2017

-05-

01

2017

-09-

01

2018

-01-

01

2018

-05-

01

2018

-09-

01

Quit Rates Are The Highest Since 2001• The quit rate is a useful measure of

how much confidence workers feel and how many opportunities they have to switch to a more attractive job

• The percentage of working-age Americans who voluntarily left their job stood at 2.4% in August, above 2007 pre-recession levels• South region quit rates are the highest,

at 2.7%, up from 2.3% a year ago

• The rise in the quit rates also bolsters expectations that wage gains will accelerate

• Leisure and Hospitality; Retail; and, Professional and Business Services have the highest quit rates

8

2.2%2.4%

1.0

1.2

1.4

1.6

1.8

2.0

2.2

2.4

2.6

2007

-01-

0120

07-0

7-01

2008

-01-

0120

08-0

7-01

2009

-01-

0120

09-0

7-01

2010

-01-

0120

10-0

7-01

2011

-01-

0120

11-0

7-01

2012

-01-

0120

12-0

7-01

2013

-01-

0120

13-0

7-01

2014

-01-

0120

14-0

7-01

2015

-01-

0120

15-0

7-01

2016

-01-

0120

16-0

7-01

2017

-01-

0120

17-0

7-01

2018

-01-

0120

18-0

7-01

Percent

Job Openings Are At an All Time High

• A high number of job openings is a mix of good and bad news

• The good: Employers are hiring. When the Great Recession was at its worst in 2009, job openings fell to 2.2 million, an all-time low

• The bad: The gain in job openings underscores the need for workers in an economy that’s continuing to expand. At the same time, the pool of qualified Americans is shrinking and making some positions tougher to fill

• Will spur employers to pay more to attract workers

• 52% of all job openings are in: Professional and Business Services; Trade, Transportation and Utilities; and Health Care

• South region of the country accounts for 37.7% of all openings

9

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

Source: Federal Reserve Bank of St. Louis

Virginia’s FY 2018 PerformanceIs There a Disconnect Between Withholding

and Job and Wage Growth?

10

Since The Recession Several Factors Have Impacted Virginia’s Job Growth

• In the Great Recession, Virginia’s job losses were not as severe as the nation’s -- Virginia’s loss equaled about 5.0% of total employment versus 6.3% nationally

• During the recession and shortly thereafter, Virginia out-performed the nation

• Budget sequestration and continued federal budget uncertainty impacted growth in 2013, 2014, and 2015

• Other factors that may impact job growth is Virginia’s low unemployment rate and the lack of skilled workers for high demand jobs

11

-6.0

-5.0

-4.0

-3.0

-2.0

-1.0

0.0

1.0

2.0

3.0

4.0

2007

-01-

0120

07-0

7-01

2008

-01-

0120

08-0

7-01

2009

-01-

0120

09-0

7-01

2010

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0120

10-0

7-01

2011

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0120

11-0

7-01

2012

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0120

12-0

7-01

2013

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0120

13-0

7-01

2014

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0120

14-0

7-01

2015

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15-0

7-01

2016

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0120

16-0

7-01

2017

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0120

17-0

7-01

2018

-01-

01

Virginia US

Percent Growth Year-Over-Year

Virginia Is Out-Performing The Nation

12

0.50

0.70

0.90

1.10

1.30

1.50

1.70

1.90

2.10

2.30

Leading Coincident Index

U.S. Virginia

The leading index for each state predicts the six-month growth rate of the state’s coincident index. In addition to the coincident index, the models include other variables that lead the economy: state-level housing permits (1 to 4 units), state initial unemployment insurance claims, delivery times from the Institute for Supply Management (ISM) manufacturing survey, and the interest rate spread between the 10-year Treasury bond and the 3-month Treasury bill

Virginia’s Unemployment Rate Is Back At Prerecession Levels, Ranks in the Lowest 8

Among States

13

2.9%

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

2007

-01-

0120

07-0

4-01

2007

-07-

0120

07-1

0-01

2008

-01-

0120

08-0

4-01

2008

-07-

0120

08-1

0-01

2009

-01-

0120

09-0

4-01

2009

-07-

0120

09-1

0-01

2010

-01-

0120

10-0

4-01

2010

-07-

0120

10-1

0-01

2011

-01-

0120

11-0

4-01

2011

-07-

0120

11-1

0-01

2012

-01-

0120

12-0

4-01

2012

-07-

0120

12-1

0-01

2013

-01-

0120

13-0

4-01

2013

-07-

0120

13-1

0-01

2014

-01-

0120

14-0

4-01

2014

-07-

0120

14-1

0-01

2015

-01-

0120

15-0

4-01

2015

-07-

0120

15-1

0-01

2016

-01-

0120

16-0

4-01

2016

-07-

0120

16-1

0-01

2017

-01-

0120

17-0

4-01

2017

-07-

0120

17-1

0-01

2018

-01-

0120

18-0

4-01

2018

-07-

01

Percent

Employment Situation Has Been Improving, Moving Closer To Pre-Recession Levels

14

7.6%

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

2007

-01-

0120

07-0

7-01

2008

-01-

0120

08-0

7-01

2009

-01-

0120

09-0

7-01

2010

-01-

0120

10-0

7-01

2011

-01-

0120

11-0

7-01

2012

-01-

0120

12-0

7-01

2013

-01-

0120

13-0

7-01

2014

-01-

0120

14-0

7-01

2015

-01-

0120

15-0

7-01

2016

-01-

0120

16-0

7-01

2017

-01-

0120

17-0

7-01

2018

-01-

01

Percent: Total Unemployed, Plus Marginally Attached, Plus Part-time

1.1%

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

2007

-01-

0120

07-0

7-01

2008

-01-

0120

08-0

7-01

2009

-01-

0120

09-0

7-01

2010

-01-

0120

10-0

7-01

2011

-01-

0120

11-0

7-01

2012

-01-

0120

12-0

7-01

2013

-01-

0120

13-0

7-01

2014

-01-

0120

14-0

7-01

2015

-01-

0120

15-0

7-01

2016

-01-

0120

16-0

7-01

2017

-01-

0120

17-0

7-01

2018

-01-

01

Percent: Unemployed 15 Weeks or Longer

June 2017-18, Virginia Employment Grew 1.2%, Adding 47,300 Jobs. Was Performance Consistent

With The Economic Forecast?

15

• Withholding taxes represents 63% of total general fund tax collections• Job growth and average wages and salaries serve as the proxy for withholding

• Virginia payroll withholding grew 5.4% or $227.2 million above forecast. When adjusted for approximately $120 million in collections that should have occurred in July, payroll withholding grew 4.4%, exceeding the forecast of 3.5%

• Preliminary economic data suggests Virginia’s job and salary growth was consistent with the forecast assumptions

• So why is there a disconnect between economic inputs and actual payroll withholding?

• Is payroll tax collections driven more by where job growth occurs, the industry mix, and wages paid?

Northern Virginia Captured 45.3% of New Jobs in June 2018, Year Over Year

• NoVa accounted for over half the total jobs, with a year-over-year rate of growth of 1.7%, ranking 23 out of 36 in job growth for MSAs over 1 million people

• Charlottesville had the highest rate of growth at 3.7%, ranking 30 out 363 in growth for MSAs under 1 million people

• Richmond and Hampton Roads had job growth less than half a percent, ranking 243 and 246 in growth for MSAs under 1 million people • These regions account for 36.5% of

Virginia total jobs, and is why Virginia’s overall growth rate was subpar

16

0.0

5.0

10.0

15.0

20.0

25.0

NOVA HamptonRoads

Richmond Roanoke Stauton Lynchburg C'ville

June Year-Over-YearJobs in Thousand

Northern Virginia Dominated Overall Job Growth, But Employment Picked Up Considerably Around March For

the Rest of The State

17

-20.0

-10.0

0.0

10.0

20.0

30.0

40.0

50.0

60.0Change From Year Ago, Thousands of Persons

Virginia NOVA Hampton Roads Richmond Rest of State

Northern Virginia Now Accounts for 37.1% of Virginia’s Total Jobs, Up From 36.5% 4 Years Ago

18

36.5%

20.0%

16.8%

26.7%

37.1%

19.6%

16.9%

26.4%

10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0%

NOVA

HamptonRoads

Richmond

Rest of Virginia

Employment By Region

2018 2014

NOVA Average Weekly Wages Are 28% Higher Than State Average, But They Are Included In The Average

• Northern Virginia accounted for 53% of the job growth in FY 18 and have average wages 41.5% and 52.1% greater than Richmond, and Hampton Roads respectively

• Professional and Business Services, which have among the highest weekly wages, accounts for 28% of Northern Virginia’s total employment• 55% of all PBS jobs are in Northern

Virginia• Richmond and Hampton Roads

account for 30%

19

$1,374

$971 $903

$-

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

NOVA Richmond Hampton Roads

Average Weekly Wages FY 2018, Quarter 2

Professional, Scientific, and Technical Services Represents 65% of PBS Employment in NOVA

• Professional, Scientific and Technical Services Sector accounts for 20% of NOVA’s total employment

• Average weekly wages are over 200% higher than the statewide average and over 56% greater than the average wages for Professional and Business Services

• Contributing to the increase in jobs has been an increase in federal procurement in the Washington region

20

$2,212

$1,414

$1,074

$0

$500

$1,000

$1,500

$2,000

$2,500

NoVa Prof, Scientific &Tech. Serv

PBS Average Wage Statewide Average Wages

Average Weekly Wages

81.5

68.9

77.9

0102030405060708090

Federal Procurement in the Washington Region, 1980-2016After Peaking in 2010, Procurement Spending Dropped For

3 Years, Before Increasing Again Since 2014

Source: US Census, Consolidated Federal Funds Report and USAspending.gov, The Stephen S. Fuller Institute at the Schar School, GMU

($s Billions)

TOTAL = $1,305.1 Billion

21

Fiscal Year 2019First Quarter Employment

22

Virginia’s Employment Growth is On Par With The Nation…But Job Growth By Region Varied

Percent Year over Year July – September 2018

23

1.3

1.6

1.7

1.6 1.61.7

0.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

1.8

2.0

July August September

Virginia U.S.

Percent Job Growth Virginia vs. U.S.

0.0

1.0

2.0

3.0

4.0

5.0

6.0Percent Growth By Region


State average growth = 1.5%

First 3 Months Saw Strength in All Regions Except Hampton Roads

24

0.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

80.0

Virginia NOVA Hampton Roads Richmond Rest of State

Change From Year Ago, Thousand of Persons


Growth in Virginia’s Employment Was Led by Construction and Manufacturing Sectors

Percent Growth, Year-over-Year September 2017-2018

25

-3.0 -2.0 -1.0 0.0 1.0 2.0 3.0 4.0 5.0

Manufacturing

Government

Construction

Education & Health

Profess & Bus. Serv.

Leisure & Hospitality

Trade, Transp, & Utilities

Financial

Average Weekly Wages For Private Employers Have Been Rising

• Average weekly wages for private industry have increased 7.1% from fiscal year 2016 through FY 2018• Average about 2.4% per year

• Average weekly wages in the first quarter of 2019 are up 4.5% over first quarter of 2018• September over September

average weekly wages is up 5.4% overall, and 5.6% in NOVA

• The strongest average wage growth has been in Professional and Business Services

26

0.0

1.0

2.0

3.0

4.0

5.0

6.0

2018-04-01 2018-05-01 2018-06-01 2018-07-01 2018-08-01 2018-09-01

Percent Change From Year Ago

FY 19 Q1 Average 4.5%

FY 18 Q4 Average 3.1%

Average Weekly Wages For Professional and Business Services (PBS) has Risen 12.8%

Fiscal Year 2015 Through FY 2019 Q1

27

$1,100

$1,150

$1,200

$1,250

$1,300

$1,350

$1,400

$1,450

$1,500

FY 2018 Performance

28

Looking Back: FY 2018 Revenue Performance• FY 2018 GF collections rose 6.3%, ahead of the annual forecast of 3.4%

growth. Annual growth remained above forecast levels 11 months of the year• Excluding transfers, revenue collections exceeded the forecast by $552.6

million, a variance of 2.9%

29

Source: Virginia Department of Taxation

5.4%

3.0%

4.1%4.9% 4.9%

5.9% 5.8%

6.2%5.2%

6.7%6.1% 6.3%

-4%

-2%

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun

Growth in Total General Fund Revenue CollectionsFY18 Monthly and Year-to-Date

Monthly Year-to-Date Forecast: 3.4%

With Transfers, FY 2018 Revenues Finished $555.5 Million Above Forecast…

30

Major Sources Official Actual ChangeWithholding 61.5% $12,313.3 $12,540.5 $227.2 3.5 % 5.4 %0.0Nonwithholding 15.6 3,147.3 3,472.9 325.6 4.3 15.1Refunds (9.6) (1,968.7) (1,907.6) 61.1 5.8 2.5

Net Individual 67.5% $13,491.9 $14,105.8 $613.9 3.4 % 8.1 %

Sales 17.4% $3,458.2 $3,461.8 $3.6 3.0 % 3.1 %Corporate 4.3 874.0 861.9 (12.1) 5.7 4.2Wills (Recordation) 2.0 407.2 394.9 (12.3) 3.3 0.1Insurance 1.8 362.1 337.9 (24.2) 6.2 (0.9)All Other Revenue 3.7 734.8 718.5 (16.3) 1.6 (0.6)

Total Revenue 96.6% $19,328.2 $19,880.8 $552.6 3.4 % 6.3 %

A.B.C. Profits 0.6 $104.1 $109.5 $5.4 (5.8) % (0.9) %3 6 6Sales Tax (0.375%) 1.9 379.1 376.6 (2.5) 3.6 2.9Transfers 0.9 142.1 142.2 0.1 (19.7) (19.6)

Total Transfers 3.4% $625.3 $628.3 $3.0 (4.3) % (3.8) %

TOTAL GENERAL FUND 100.0% $19,953.5 $20,509.0 $555.5 3.1 % 6.0 %

As a % of Total General Fund

% Growth Over FY 17Official Actual

Summary of Fiscal Year 2018 Revenue Collections(millions of dollars)

presentation

*** Governor's Confidential Working Papers ****** Governor's Confidential Working Papers ****** Governor's Confidential Working Papers ***

Table 3.3Table 3.3Table 3.3Table 3.3

The December and Official General Fund Forecast for Fiscal Year 2018The December and Official General Fund Forecast for Fiscal Year 2019The Official and November Standard General Fund Forecast for Fiscal Year 2013The December and Offical General Fund Forecast for Fiscal Year 2020The February General Fund Forecast for Fiscal Years 2017-2018The November Standard General Fund Forecast for Fiscal Years 2017-2020The November Standard General Fund Forecast for Fiscal Years 2017-2020

(Dollars in Millions)(Dollars in Millions)6/7/18(Dollars in Millions)6/7/18(Dollars in Millions)(Dollars in Millions)June 7, 2018(Dollars in Millions)June 7, 2018(Dollars in Millions)June 7, 2018(Dollars in Millions)June 7, 2018

Fiscal Year 2015Fiscal Year 2018Fiscal Year 2018Fiscal Year 2019Fiscal Year 2013Fiscal Year 20202018-2020 BienniumFiscal Year 2017Fiscal Year 20182016-2018 BienniumFY 17FY 18FY 19FY 20

IgnoreAs a % of Total General Fund% Growth Over FY 17% Growth Over FY 16ERROR:#REF!0.0% Growth Over FY 12As a % of Total% Growth Over FY17February% Growth Over FY 16February% Growth Over FY 17February% Growth Over 14-16Fiscal YearFiscal YearFiscal YearFiscal Year% Growth% Growth% Growth% Growth

Major SourcesActual% GrowthOfficialActualChangeOfficialActualMajor SourcesOfficial% GrowthDecemberOfficialChangeDecemberOfficialForecastForecastChangeERROR:#REF!0.0RevenuesDecemberOfficialChangeDecemberOfficialDecemberOfficialChangeForecastForecastForecast2017201820192020Over FY 16Over FY 17Over FY 18Over FY 19

0.00.0ERROR:#DIV/0!ERROR:#DIV/0!0.0

Withholding$11,895.4ERROR:#DIV/0!61.5%$12,313.3$12,540.5$227.23.5%5.4%Withholding$12,313.34.1%24,208.761.8%$12,810.2$12,870.2$60.04.0%4.5Withholding12,810.212,870.260.04.04.5Withholding61.9%$13,308.5$13,368.5$60.03.9%3.9%$26,118.7$26,238.7$120.0Withholding$12,870.22.6%$13,368.53.9%$26,238.78.4%Withholding14,884.915,432.20.00.0Withholding11.33.7(100.0)ERROR:#DIV/0!

0.00.00.00.0ERROR:#DIV/0!ERROR:#DIV/0!0.0

Nonwithholding3,018.5ERROR:#DIV/0!15.63,147.33,472.9325.64.315.1Nonwithholding3,147.31.96,165.80.0ERROR:#DIV/0!3,361.53,368.36.86.87.0Nonwithholding3,361.53,368.36.86.87.0Nonwithholding16.83,631.03,635.04.08.07.96,992.57,003.310.8Nonwithholding3,368.3(3.0)3,635.07.97,003.313.6Nonwithholding4,265.54,444.40.00.0Nonwithholding17.34.2(100.0)ERROR:#DIV/0!

0.00.00.00.0

Refunds(1,861.0)13.8(9.6)(1,968.7)(1,907.6)61.15.82.5Refunds(1,968.7)1.2(3,829.7)0.014.9(2,061.3)(2,054.7)6.64.74.4Refunds(2,061.3)(2,054.7)6.64.74.4Refunds(9.9)(2,153.9)(2,147.3)6.64.54.5(4,215.2)(4,202.0)13.2Refunds(2,054.7)7.7(2,147.3)4.5(4,202.0)9.7Refunds(2,472.5)(2,571.8)0.00.0Refunds15.14.0(100.0)ERROR:#DIV/0!

0.00.00.00.00.0ERROR:#DIV/0!ERROR:#DIV/0!0.0%0.0

Net Individual13,052.959.567.5%$13,491.9$14,105.8$613.93.4%8.1%Net Individual$13,491.94.0%26,544.80.063.5$14,110.4$14,183.8$73.44.6%5.1%Net14,110.414,183.873.44.65.1Net Individual68.8%$14,785.6$14,856.2$70.64.84.7$28,896.0$29,040.0$144.0Net Individual$14,183.80.6$14,856.24.7$29,040.09.4Net16,677.917,304.80.00.0Net12.33.8(100.0)ERROR:#DIV/0!

0.00.00.0

Sales3,357.138.917.4%$3,458.2$3,461.8$3.63.0%3.1%Sales$3,458.24.1%6,815.30.043.0$3,547.1$3,547.3$0.22.6%2.6%State Sales & Use Tax3,547.13,547.30.22.62.6Sales16.8%$3,625.0$3,625.2$0.22.22.2$7,172.1$7,172.5$0.4State Sales & Use Tax$3,547.32.5$3,625.22.2$7,172.55.2State Sales & Use Tax3,852.53,929.70.00.0State Sales & Use Tax6.32.0(100.0)ERROR:#DIV/0!

0.00.00.00.0%

Corporate$827.021.6%4.3874.0861.9(12.1)5.74.2Corporate874.0(13.1)1,701.00.08.5912.0912.00.04.34.3Corporate Income$912.0$912.0$0.04.3%4.3%Corporate4.3926.4926.40.01.61.61,838.41,838.40.0Corporate Income912.05.8926.41.61,838.48.1Corporate Income$982.8$1,007.8$0.0$0.0Corporate Income6.1%2.5%(100.0)%ERROR:#DIV/0!%

0.00.00.00.00.0

Wills (Recordation)394.469.32.0407.2394.9(12.3)3.30.1Wills (Recordation)407.210.6801.60.079.9407.2407.20.00.00.0Wills, Suits, Deeds, & Contract Fees407.2407.20.00.00.0Wills (Recordation)1.9407.2407.20.00.00.0814.4814.40.0Wills (Recordation)407.23.1407.20.0814.41.6Wills, Suits, Deeds, & Contract Fees407.2407.20.00.0Wills, Suits, Deeds, & Contract Fees0.00.0(100.0)ERROR:#DIV/0!

0.00.00.00.00.0ERROR:#DIV/0!ERROR:#DIV/0!0.00.0

Insurance340.975.21.8362.1337.9(24.2)6.2(0.9)Insurance362.17.3703.00.082.5376.6376.60.04.04.0Insurance Company Premiums376.6376.60.04.04.0Insurance1.8384.6397.613.02.15.6761.2774.213.0Insurance376.611.4397.65.6774.210.1Insurance Company Premiums438.6455.80.00.0Insurance Company Premiums10.33.9(100.0)ERROR:#DIV/0!

0.00.00.00.00.0ERROR:#DIV/0!ERROR:#DIV/0!0.00.0

All Other Revenue$722.9(4.0)%3.7734.8718.5(16.3)1.6(0.6)All Other Revenue$734.8(0.4)1,457.70.0(4.4)743.2746.83.61.11.6Total Misc. Taxes and Other Revenues$743.2$746.8$3.61.1%1.6%All Other Revenue3.5763.5763.60.12.72.21,506.71,510.43.7All Other Revenue763.96.3763.90.01,527.84.8Total Misc. Taxes and Other Revenues$763.9$763.9$0.0$0.0Total Misc. Taxes and Other Revenues0.0%0.0%(100.0)%ERROR:#DIV/0!%

0.00.00.0

MISCELLANEOUS TAXES AND OTHER REVENUESMISCELLANEOUS TAXES AND OTHER REVENUES0.00.00.0MISCELLANEOUS TAXES AND OTHER REVENUESMISCELLANEOUS TAXES AND OTHER REVENUES0.0%MISCELLANEOUS TAXES AND OTHER REVENUESMISCELLANEOUS TAXES AND OTHER REVENUESMISCELLANEOUS TAXES AND OTHER REVENUES

0.00.00.00.0%

Alcoholic Beverage State Tax$180.71.8%189.7$191.01.35.0%5.7%Alcoholic Beverage State Tax$189.70.1%370.40.01.9197.5$197.50.04.1%4.1%Alcoholic Beverage State Tax$197.5$197.5$0.04.1%4.1%Alcoholic Beverage State Tax1.0%205.9205.90.04.3%4.3%403.4403.40.0Alcoholic Beverage State Tax$205.97.8%$205.90.0%$411.811.2%Alcoholic Beverage State Tax$205.9$205.9$0.0$0.0Alcoholic Beverage State Tax0.0%0.0%(100.0)%ERROR:#DIV/0!%

0.00.00.00.00.0ERROR:#DIV/0!%ERROR:#DIV/0!%0.0%0.0

Bank Franchise Tax22.089.922.024.02.0(0.2)8.7Bank Franchise Tax22.08.844.00.098.722.022.00.00.00.0Bank Franchise Tax22.022.00.00.00.0Bank Franchise Tax0.1%22.022.00.00.00.044.044.00.0Bank Franchise Tax22.0(8.2)22.00.044.0(0.1)Bank Franchise Tax22.022.00.00.0Bank Franchise Tax0.00.0(100.0)ERROR:#DIV/0!


Beer & Beverage Excise Tax41.79.342.340.9(1.4)1.5(2.0)Beer & Beverage Excise Tax42.3(0.1)84.00.09.242.342.30.00.00.0Beer & Beverage Excise Tax42.342.30.00.00.0Beer & Beverage Excise Tax0.2%42.342.30.00.00.084.684.60.0Beer & Beverage Excise Tax42.33.542.30.084.60.7Beer & Beverage Excise Tax42.342.30.00.0Beer & Beverage Excise Tax0.00.0(100.0)ERROR:#DIV/0!

0.00.00.00.00.0ERROR:#DIV/0!%ERROR:#DIV/0!0.0%0.0

Corporate Franchise & Charter Fees53.474.351.253.62.4(4.0)0.5Corporate Franchise & Charter Fees51.20.1104.60.074.451.251.20.00.00.0Corporate Franchise & Charter Fees51.251.20.00.00.0Corporate Franchise & Charter Fees0.2%51.251.20.00.00.0102.4102.40.0Corporate Franchise & Charter Fees51.2(4.5)51.20.0102.4(2.1)Corporate Franchise & Charter Fees51.251.20.00.0Corporate Franchise & Charter Fees0.00.0(100.0)ERROR:#DIV/0!

0.00.00.00.0%

Excess & Other Fees from Officers(7.9)(55.1)(7.9)(7.7)0.20.43.5Excess & Other Fees from Officers(7.9)(0.3)(15.8)0.0(55.4)(7.9)(7.9)0.00.00.0Excess & Other Fees from Officers(7.9)(7.9)0.00.00.0Excess & Other Fees from Officers-0.0%(7.9)(7.9)0.00.00.0(15.8)(15.8)0.0Excess & Other Fees from Officers(7.9)3.2(7.9)0.0(15.8)(0.2)Excess & Other Fees from Officers(7.9)(7.9)0.00.0Excess & Other Fees from Officers0.00.0(100.0)ERROR:#DIV/0!


Estate & Gifts8.258.80.80.90.1(90.2)(88.6)Estate & Gifts0.8(100.0)9.00.0(41.2)0.00.00.0(100.0)(100.0)Estate & Gifts0.00.00.0(100.0)(100.0)Estate & Gifts0.0%0.00.00.0n/an/a0.00.0n/aEstate & Gifts0.0n/a0.0n/a0.0n/aEstate & Gifts0.00.00.00.0Estate & Gifts


Institutional Revenues2.3(0.9)2.12.80.7(7.0)22.1Institutional Revenues2.1(1.0)4.40.0(1.9)2.12.10.00.00.0Institutional Revenues2.12.10.00.00.0Institutional Revenues0.0%2.12.10.00.00.04.24.20.0Institutional Revenues2.1(23.9)2.10.04.2(3.6)Institutional Revenues2.12.10.00.0Institutional Revenues0.00.0(100.0)ERROR:#DIV/0!


Interest & Rents56.0(6.6)68.161.7(6.4)21.710.3Interest & Rents68.1(5.6)124.10.0(12.2)66.566.50.0(2.3)(2.3)Interest & Rents66.566.50.0(2.3)%(2.3)Interest & Rents0.3%73.073.00.09.89.8139.5139.50.0Interest & Rents73.018.273.00.0146.017.7Interest & Rents73.073.00.00.0Interest & Rents0.00.0(100.0)ERROR:#DIV/0!

0.00.00.00.0%

Licenses & Permits4.2(75.0)4.24.0(0.2)0.9(3.7)Licenses & Permits4.2(1.5)8.40.0(76.4)4.24.20.00.00.0Licenses & Permits4.24.20.00.0%0.0Licenses & Permits0.0%4.24.20.00.00.08.48.40.0Licenses & Permits4.24.84.20.08.40.5Licenses & Permits4.24.20.00.0Licenses & Permits0.00.0(100.0)ERROR:#DIV/0!


Miscellaneous Taxes and Penalties237.338.5231.5229.2(2.3)(2.4)(3.4)Miscellaneous Taxes and Penalties231.5(0.1)468.80.038.4234.8234.90.11.41.5Miscellaneous Taxes and Penalties234.8234.90.11.4%1.5Miscellaneous Taxes and Penalties1.1%240.2240.30.12.32.3475.0475.20.2Miscellaneous Taxes and Penalties240.65.0240.60.0481.22.7Miscellaneous Taxes and Penalties240.6240.60.00.0Miscellaneous Taxes and Penalties0.00.0(100.0)ERROR:#DIV/0!


Other Miscellaneous Revenues30.1(33.8)32.819.4(13.4)8.9(35.4)Other Miscellaneous Revenues32.8(6.0)62.90.0(39.9)32.536.03.5(0.9)9.8Other Miscellaneous Revenues32.536.03.5(0.9)%9.8Other Miscellaneous Revenues0.2%32.532.50.00.0(9.7)65.068.53.5Other Miscellaneous Revenues32.567.132.50.065.03.3Other Miscellaneous Revenues32.532.50.00.0Other Miscellaneous Revenues0.00.0(100.0)ERROR:#DIV/0!


Public Service GR / Consumption Tax95.1(22.7)98.098.70.73.13.8Public Service GR / Consumption Tax98.00.4193.10.0(22.4)98.098.00.00.00.0Public Service GR / Consumption Tax98.098.00.00.0%0.0Public Service GR / Consumption Tax0.5%98.098.00.00.00.0196.0196.00.0Public Service GR / Consumption Tax98.0(0.7)98.00.0196.01.5Public Service GR / Consumption Tax98.098.00.00.0Public Service GR / Consumption Tax0.00.0(100.0)ERROR:#DIV/0!

Total Revenue$18,695.196.6%$19,328.2$19,880.8$552.63.4%6.3%Total Revenue$19,328.23.2%38,023.30.03.2$20,096.5$20,173.7$77.24.0%4.4%Total Revenue97.1%$20,892.3$20,976.2$83.94.0%4.0%$40,988.8$41,149.9$161.1Total Revenue$20,190.81.6%$20,976.53.9%41,167.38.3%

0.00.00.00.0%

TOTAL GF REVENUES$ERROR:#REF!44.5%$ERROR:#REF!$ERROR:#REF!ERROR:#REF!ERROR:#REF!%ERROR:#REF!%TOTAL GF REVENUES$ERROR:#REF!ERROR:#REF!%ERROR:#REF!0.0ERROR:#REF!ERROR:#REF!$ERROR:#REF!ERROR:#REF!ERROR:#REF!%ERROR:#REF!%TOTAL GF REVENUES$ERROR:#REF!$ERROR:#REF!$ERROR:#REF!ERROR:#REF!%ERROR:#REF!%TOTAL GF REVENUESERROR:#REF!ERROR:#REF!ERROR:#REF!ERROR:#REF!ERROR:#REF!%ERROR:#REF!%ERROR:#REF!ERROR:#REF!ERROR:#REF!TOTAL GF REVENUES$ERROR:#REF!ERROR:#REF!%$ERROR:#REF!ERROR:#REF!%$ERROR:#REF!ERROR:#REF!%TOTAL GF REVENUES$ERROR:#REF!$ERROR:#REF!$ERROR:#REF!$ERROR:#REF!TOTAL GF REVENUESERROR:#REF!%ERROR:#REF!%ERROR:#REF!%ERROR:#REF!%

0.00.00.00.0%

TRANSFERSTRANSFERS0.00.00.0TRANSFERSTRANSFERS0.0%TRANSFERSTRANSFERSTRANSFERS

0.00.00.0

A.B.C. Profits$$110.53.0%0.6$104.1$109.5$5.4(5.8)%(0.9)%A.B.C. Profits$$104.1(3.7)%214.60.0(0.7)$109.8$109.8$0.05.5%5.5%A.B.C. Profits$109.8$109.8$0.05.5%5.5%A.B.C. Profits0.5$115.5$115.5$0.05.2%5.2%$225.3$225.3$0.0A.B.C. Profits$109.80.3%$115.55.2%$225.35.0%A.B.C. Profits$115.5$115.5$0.0$0.0A.B.C. Profits0.0%0.0%(100.0)%ERROR:#DIV/0!%

0.00.00.00.00.0ERROR:#DIV/0!%ERROR:#DIV/0!%0.0ERROR:#DIV/0!ERROR:#DIV/0!0.0ERROR:#DIV/0!ERROR:#DIV/0!ERROR:#DIV/0!ERROR:#DIV/0!ERROR:#DIV/0!

Lottery Proceeds Fund0.0ERROR:#REF!0.00.00.0ERROR:#DIV/0!ERROR:#DIV/0!Lottery Proceeds Fund0.0ERROR:#DIV/0!0.00.0ERROR:#REF!0.00.00.0ERROR:#DIV/0!ERROR:#DIV/0!Lottery Proceeds Fund0.00.00.0ERROR:#DIV/0!%ERROR:#DIV/0!%Lottery Proceeds Fund0.00.00.00.0n/an/a0.00.00.0Lottery Proceeds Fund0.0ERROR:#DIV/0!0.0ERROR:#DIV/0!0.0ERROR:#DIV/0!Lottery Proceeds Fund0.00.00.00.0Lottery Proceeds FundERROR:#DIV/0!ERROR:#DIV/0!ERROR:#DIV/0!ERROR:#DIV/0!

376.6379.1379.10.00.0386.70.0386.7(100.0)%2.0%0.00.0

Sales Tax (0.375%)365.9ERROR:#DIV/0!1.9379.1376.6(2.5)3.62.9Sales Tax (0.375%)379.15.0745.00.0ERROR:#DIV/0!386.7386.70.02.02.0Sales Tax (0.25%)386.7386.70.02.02.0Sales Tax (0.375%)1.8395.2395.20.02.22.2781.9781.90.0Sales Tax (0.375%)386.72.7395.22.2781.95.0Sales Tax (0.25%)421.0429.40.00.0Sales Tax (0.25%)6.52.0(100.0)ERROR:#DIV/0!

0.00.00.00.00.0ERROR:#DIV/0!%ERROR:#DIV/0!%0.00.0

Transfers176.990.40.9142.1142.20.1(19.7)(19.6)Transfers139.5(40.1)316.40.050.3119.2124.55.3(16.1)(10.8)Transfers Per Appropriations Act119.2124.55.3(14.6)(10.8)Transfers Per Act0.6115.0120.35.3(3.5)(3.4)234.2244.810.6Transfers Per Act124.5(12.4)120.3(3.4)244.8(22.6)Transfers Per Appropriations Act115.0115.00.00.0Transfers Per Appropriations Act(4.4)0.0(100.0)ERROR:#DIV/0!

0.00.00.0

Total Transfers$$ 653.345.9%3.4%$625.3$628.3$3.0(4.3)%(3.8)%Total Transfers$$622.7(10.3)%1,276.00.035.7$615.7$621.0$5.3(1.5)%(0.3)%Total Transfers$615.7$621.0$5.3(1.1)%(0.3)%Total Transfers2.9%$625.7$631.0$5.31.6%1.6%$1,241.4$1,252.0$10.6Total Transfers$621.0(1.2)%$631.01.6%$1,252.0(1.9)%Total Transfers$651.5$659.9$0.0$0.0Total Transfers3.2%1.3%(100.0)%ERROR:#DIV/0!%

0.00.00.0

TOTAL GENERAL FUND$19,348.444.6%100.0%$19,953.5$20,509.0$555.53.1%6.0%TOTAL GENERAL FUND$$19,950.92.8%39,299.30.047.4$20,712.2$20,794.7$82.53.8%4.2%TOTAL GENERAL FUND$20,712.2$20,794.7$82.53.8%4.2%TOTAL GENERAL FUND100.0%$21,518.0$21,607.2$89.23.9%3.9%$42,230.2$42,401.9$171.7TOTAL GENERAL FUND$20,811.81.5%$21,607.53.8%$42,419.37.9%TOTAL GENERAL FUND$ERROR:#REF!$ERROR:#REF!$ERROR:#REF!$ERROR:#REF!TOTAL GENERAL FUNDERROR:#REF!%ERROR:#REF!%ERROR:#REF!%ERROR:#REF!%

$ Change From Previous Year$ERROR:#REF!$ERROR:#REF!$ERROR:#REF!$ERROR:#REF!

The Official forecast is based on the November 2011 Global Insight US Standard outlook and the corresponding Virginia economic outlook developed by the Department of Taxation. It includes actions of the 2012 General Assembly - Chapter 3.The Official forecast is based on the November 2011 Global Insight US Standard outlook and the corresponding Virginia economic outlook developed by the Department of Taxation. It includes actions of the 2012 General Assembly - Chapter 3.The December forecast is based on the November 2015 I H S Standard Outlook and the corresponding Virginia state forecast developed by the Department of Taxation.The December forecast is based on the November 2015 I H S Standard Outlook and the corresponding Virginia state forecast developed by the Department of Taxation.

TOTAL BIENNIUM GENERAL FUND$ERROR:#REF!$ERROR:#REF!

The December forecast is based on the November 2015 I H S Standard Outlook and the corresponding Virginia state forecast developed by the Department of Taxation.The December forecast is based on the November 2015 I H S Standard Outlook and the corresponding Virginia state forecast developed by the Department of Taxation.

$ Change From Previous Biennium$ERROR:#REF!$ERROR:#REF!

% Growth From Previous BienniumERROR:#REF!ERROR:#REF!%

Print

The December to Official General Fund Forecast for Fiscal Year 2018The December and Official General Fund Forecast for Fiscal Year 2019The December and Official General Fund Forecast for Fiscal Year 2020The December General Fund Forecast for Fiscal Years 2020-22The December General Fund Forecast for Fiscal Years 2023-26The December General Fund Forecast for Fiscal Years 2023-26

(Dollars in Millions)June 7, 2018(Dollars in Millions)June 7, 2018(Dollars in Millions)June 7, 2018(Dollars in Millions)June 7, 2018(Dollars in Millions)June 7, 2018(Dollars in Millions)June 7, 2018

Fiscal Year 2017Fiscal Year 2018Fiscal Year 2019Fiscal Year 20202018-2020 BienniumFiscal Year 2021Fiscal Year 20222020-2022 BienniumFY 19FY 20FY 21FY 22

Official% Growth Over FY 17DecemberOfficial% Growth Over FY 18DecemberOfficial% Growth Over FY 19DecemberOfficialOfficial% Growth Over FY 20Official% Growth Over FY 21Official% Growth Over 18-20Fiscal YearFiscal YearFiscal YearFiscal Year% Growth% Growth% Growth% Growth

Actual% GrowthForecastActualChangeOfficialActualForecastForecastChangeDecemberOfficialForecastForecastChangeDecemberOfficialForecastForecastChangeForecastForecastForecast2023202420252026Over FY 18Over FY 19Over FY 20Over FY 21

MAJOR TAX SOURCESMAJOR TAX SOURCESMAJOR TAX SOURCESMAJOR TAX SOURCESMAJOR TAX SOURCESMAJOR TAX SOURCES

Corporate Income$827.08.1%$874.0$861.9$(12.1)5.7%4.2%Corporate Income$912.0$912.0$0.04.3%5.8%Corporate Income$926.4$926.4$0.01.6%1.6%$1,838.4$1,838.4$0.0Corporate Income$943.71.9%$960.01.7%$1,903.73.6%Corporate Income$982.8$1,007.8$0.0$0.0Corporate Income2.4%2.5%(100.0)%ERROR:#DIV/0!%

Individual Income Tax:Individual Income Tax:Individual Income Tax:Individual Income Tax:Individual Income Tax:Individual Income Tax:

Gross14,913.93.715,460.616,013.4552.83.77.4Gross16,171.716,238.566.84.61.4Gross16,939.517,003.564.04.74.733,111.233,242.0130.8Gross17,692.74.118,437.24.236,129.98.7Gross19,150.419,876.60.00.0Gross3.93.8(100.0)ERROR:#DIV/0!

0.0

Withholding11,895.45.212,313.312,540.5227.23.55.4Withholding12,810.212,870.260.04.02.6Withholding13,308.513,368.560.03.93.926,118.726,238.7120.0Withholding13,821.13.414,347.73.828,168.87.4Withholding14,884.915,432.20.00.0Withholding3.73.7(100.0)ERROR:#DIV/0!

0.0

Nonwithholding3,018.5(1.7)3,147.33,472.9325.64.315.1Nonwithholding3,361.53,368.36.86.8(3.0)Nonwithholding3,631.03,635.04.08.07.96,992.57,003.310.8Nonwithholding3,871.66.54,089.55.67,961.113.7Nonwithholding4,265.54,444.40.00.0Nonwithholding4.34.2(100.0)ERROR:#DIV/0!

0.0

Refunds(1,861.0)2.2(1,968.7)(1,907.6)61.15.82.5Refunds(2,061.3)(2,054.7)6.64.77.7Refunds(2,153.9)(2,147.3)6.64.54.5(4,215.2)(4,202.0)13.2Refunds(2,265.9)5.5(2,377.1)4.9(4,643.0)10.5Refunds(2,472.5)(2,571.8)0.00.0Refunds4.04.0(100.0)ERROR:#DIV/0!

0.0

Net13,052.94.013,491.914,105.8613.93.48.1Net14,110.414,183.873.44.60.6Net14,785.614,856.270.64.84.728,896.029,040.0144.0Net15,426.83.816,060.14.131,486.98.4Net16,677.917,304.80.00.0Net3.83.8(100.0)ERROR:#DIV/0!

0.0

Insurance Company Premiums340.90.5362.1337.9(24.2)6.2(0.9)Insurance Company Premiums376.6376.60.04.011.4Insurance Company Premiums384.6397.613.02.15.6761.2774.213.0Insurance Company Premiums405.92.1422.54.1828.47.0Insurance Company Premiums438.6455.80.00.0Insurance Company Premiums3.83.9(100.0)ERROR:#DIV/0!

0.0

State Sales & Use Tax3,357.11.93,458.23,461.83.63.03.1State Sales & Use Tax3,547.13,547.30.22.62.5State Sales & Use Tax3,625.03,625.20.22.22.27,172.17,172.50.4State Sales & Use Tax3,700.82.13,777.92.17,478.74.3State Sales & Use Tax3,852.53,929.70.00.0State Sales & Use Tax2.02.0(100.0)ERROR:#DIV/0!

0.0

Wills, Suits, Deeds, & Contract Fees394.46.9407.2394.9(12.3)3.30.1Wills, Suits, Deeds, & Contract Fees407.2407.20.00.03.1Wills, Suits, Deeds, & Contract Fees407.2407.20.00.00.0814.4814.40.0Wills, Suits, Deeds, & Contract Fees407.20.0407.20.0814.40.0Wills, Suits, Deeds, & Contract Fees407.2407.20.00.0Wills, Suits, Deeds, & Contract Fees0.00.0(100.0)ERROR:#DIV/0!

Total Major Tax Sources$17,972.23.7%$18,593.4$19,162.3$568.93.5%6.6%Total Major Tax Sources$19,353.3$19,426.9$73.64.1%1.4%Total Major Tax Sources$20,128.8$20,212.6$83.84.0%4.0%$39,482.1$39,639.5$157.4Total Major Tax Sources$20,884.43.3%$21,627.73.6%$42,512.17.2%Total Major Tax Sources$22,359.0$23,105.3$0.0$0.0Total Major Tax Sources3.4%3.3%(100.0)%ERROR:#DIV/0!%

MISCELLANEOUS TAXES AND OTHER REVENUESMISCELLANEOUS TAXES AND OTHER REVENUESMISCELLANEOUS TAXES AND OTHER REVENUESMISCELLANEOUS TAXES AND OTHER REVENUESMISCELLANEOUS TAXES AND OTHER REVENUESMISCELLANEOUS TAXES AND OTHER REVENUES

Alcoholic Beverage State Tax$180.73.1%$189.7$191.0$1.35.0%5.7%Alcoholic Beverage State Tax$197.5$197.5$0.04.1%3.4%Alcoholic Beverage State Tax$205.9$205.9$0.04.3%4.3%$403.4$403.4$0.0Alcoholic Beverage State Tax$205.90.0%$205.90.0%$411.82.1%Alcoholic Beverage State Tax$205.9$205.9$0.0$0.0Alcoholic Beverage State Tax0.0%0.0%(100.0)%ERROR:#DIV/0!%

%0.0

Bank Franchise Tax22.023.922.024.02.0(0.2)8.7Bank Franchise Tax22.022.00.00.0(8.2)Bank Franchise Tax22.022.00.00.00.044.044.00.0Bank Franchise Tax22.00.022.00.044.00.0Bank Franchise Tax22.022.00.00.0Bank Franchise Tax0.00.0(100.0)ERROR:#DIV/0!

%0.0

Beer & Beverage Excise Tax41.7(1.4)42.340.9(1.4)1.5(2.0)Beer & Beverage Excise Tax42.342.30.00.03.5Beer & Beverage Excise Tax42.342.30.00.00.084.684.60.0Beer & Beverage Excise Tax42.30.042.30.084.60.0Beer & Beverage Excise Tax42.342.30.00.0Beer & Beverage Excise Tax0.00.0(100.0)ERROR:#DIV/0!

0.0

Corporate Franchise & Charter Fees53.4(0.5)51.253.62.4(4.0)0.5Corporate Franchise & Charter Fees51.251.20.00.0(4.5)Corporate Franchise & Charter Fees51.251.20.00.00.0102.4102.40.0Corporate Franchise & Charter Fees51.20.051.20.0102.40.0Corporate Franchise & Charter Fees51.251.20.00.0Corporate Franchise & Charter Fees0.00.0(100.0)ERROR:#DIV/0!

Excess & Other Fees from Officers(7.9)(7.9)(7.9)(7.7)0.20.43.5Excess & Other Fees from Officers(7.9)(7.9)0.00.03.2Excess & Other Fees from Officers(7.9)(7.9)0.00.00.0(15.8)(15.8)0.0Excess & Other Fees from Officers(7.9)0.0(7.9)0.0(15.8)0.0Excess & Other Fees from Officers(7.9)(7.9)0.00.0Excess & Other Fees from Officers0.00.0(100.0)ERROR:#DIV/0!

%0.0

Estate & Gifts8.23,594.60.80.90.1(90.2)(88.6)Estate & Gifts0.00.00.0n/an/aEstate & Gifts0.00.00.0n/an/a0.00.0n/aEstate & Gifts0.0n/a0.0n/a0.0n/aEstate & Gifts0.00.00.00.0Estate & Gifts

%0.0

Institutional Revenues2.3(57.0)2.12.80.7(7.0)22.1Institutional Revenues2.12.10.00.0(23.9)Institutional Revenues2.12.10.00.00.04.24.20.0Institutional Revenues2.10.02.10.04.20.0Institutional Revenues2.12.10.00.0Institutional Revenues0.00.0(100.0)ERROR:#DIV/0!

%0.0

Interest & Rents56.06.468.161.7(6.4)21.710.3Interest & Rents66.566.50.0(2.3)%7.7Interest & Rents73.073.00.09.89.8139.5139.50.0Interest & Rents73.00.073.00.0146.04.7Interest & Rents73.073.00.00.0Interest & Rents0.00.0(100.0)ERROR:#DIV/0!

Licenses & Permits4.20.94.24.0(0.2)0.9(3.7)Licenses & Permits4.24.20.00.0%4.8Licenses & Permits4.24.20.00.00.08.48.40.0Licenses & Permits4.20.04.20.08.40.0Licenses & Permits4.24.20.00.0Licenses & Permits0.00.0(100.0)ERROR:#DIV/0!

%0.0

Miscellaneous Taxes and Penalties237.3(1.3)231.5229.2(2.3)(2.4)(3.4)Miscellaneous Taxes and Penalties234.8234.90.11.4%2.5Miscellaneous Taxes and Penalties240.2240.30.12.32.3475.0475.20.2Miscellaneous Taxes and Penalties240.60.1240.60.0481.21.3Miscellaneous Taxes and Penalties240.6240.60.00.0Miscellaneous Taxes and Penalties0.00.0(100.0)ERROR:#DIV/0!

%0.0

Other Miscellaneous Revenues30.1(22.3)32.819.4(13.4)8.9(35.4)Other Miscellaneous Revenues32.536.03.5(0.9)%85.1Other Miscellaneous Revenues32.532.50.00.0(9.7)65.068.53.5Other Miscellaneous Revenues32.50.032.50.065.0(5.1)Other Miscellaneous Revenues32.532.50.00.0Other Miscellaneous Revenues0.00.0(100.0)ERROR:#DIV/0!

%0.0

Public Service GR / Consumption Tax95.12.798.098.70.73.13.8Public Service GR / Consumption Tax98.098.00.00.0%(0.7)Public Service GR / Consumption Tax98.098.00.00.00.0196.0196.00.0Public Service GR / Consumption Tax98.00.098.00.0196.00.0Public Service GR / Consumption Tax98.098.00.00.0Public Service GR / Consumption Tax0.00.0(100.0)ERROR:#DIV/0!

Total Misc. Taxes and Other Revenues$722.91.0%$734.8$718.5$(16.3)1.6%(0.6)%Total Misc. Taxes and Other Revenues$743.2$746.8$3.61.1%3.9%Total Misc. Taxes and Other Revenues$763.5$763.6$0.12.7%2.2%$1,506.7$1,510.4$3.7Total Misc. Taxes and Other Revenues$763.90.0%$763.90.0%$1,527.81.2%Total Misc. Taxes and Other Revenues$763.9$763.9$0.0$0.0Total Misc. Taxes and Other Revenues0.0%0.0%(100.0)%ERROR:#DIV/0!%

TOTAL GF REVENUES$18,695.13.6%$19,328.2$19,880.8$552.63.4%6.3%TOTAL GF REVENUES$20,096.5$20,173.7$77.24.0%1.5%TOTAL GF REVENUES$20,892.3$20,976.2$83.94.0%4.0%$40,988.8$41,149.9$161.1TOTAL GF REVENUES$21,648.33.2%$22,391.63.4%$44,039.97.0%TOTAL GF REVENUES$23,122.9$23,869.2$0.0$0.0TOTAL GF REVENUES3.3%3.2%(100.0)%ERROR:#DIV/0!%

TRANSFERSTRANSFERSTRANSFERSTRANSFERSTRANSFERSTRANSFERS

A.B.C. Profits$110.527.7%$104.1$109.5$5.4(5.8)%(0.9)%A.B.C. Profits$109.8$109.8$0.05.5%0.3%A.B.C. Profits$115.5$115.5$0.05.2%5.2%$225.3$225.3$0.0A.B.C. Profits$115.50.0%$115.50.0%$231.02.5%A.B.C. Profits$115.5$115.5$0.0$0.0A.B.C. Profits0.0%0.0%(100.0)%ERROR:#DIV/0!%

ERROR:#DIV/0!%ERROR:#DIV/0!%ERROR:#DIV/0!ERROR:#DIV/0!0.0ERROR:#DIV/0!ERROR:#DIV/0!ERROR:#DIV/0!ERROR:#DIV/0!ERROR:#DIV/0!

Lottery Proceeds Fund0.0ERROR:#DIV/0!0.00.00.0ERROR:#DIV/0!ERROR:#DIV/0!Lottery Proceeds Fund0.00.00.0ERROR:#DIV/0!%ERROR:#DIV/0!%Lottery Proceeds Fund0.00.00.0n/an/a0.00.00.0Lottery Proceeds Fund0.0ERROR:#DIV/0!0.0ERROR:#DIV/0!0.0ERROR:#DIV/0!Lottery Proceeds Fund0.00.00.00.0Lottery Proceeds FundERROR:#DIV/0!ERROR:#DIV/0!ERROR:#DIV/0!ERROR:#DIV/0!

376.6%0.0

Sales Tax (0.25%)365.92.9379.1376.6(2.5)3.62.9Sales Tax (0.375%)386.7386.70.02.02.7Sales Tax (0.375%)395.2395.20.02.22.2781.9781.90.0Sales Tax (0.375%)404.62.4412.72.0817.34.5Sales Tax (0.375%)421.0429.40.00.0Sales Tax (0.375%)2.02.0(100.0)ERROR:#DIV/0!

%0.0

Transfers Per Appropriations Act176.947.9142.1142.20.1(19.7)(19.6)Transfers Per Appropriations Act119.2124.55.3(16.1)(12.4)Transfers Per Appropriations Act115.0120.35.3(3.5)(3.4)234.2244.810.6Transfers Per Appropriations Act115.0(4.4)115.00.0230.0(6.0)Transfers Per Appropriations Act115.0115.00.00.0Transfers Per Appropriations Act0.00.0(100.0)ERROR:#DIV/0!

Total Transfers$653.316.3%$625.3$628.3$3.0(4.3)%(3.8)%Total Transfers$615.7$621.0$5.3(1.5)%(1.2)%Total Transfers$625.7$631.0$5.31.6%1.6%$1,241.4$1,252.0$10.6Total Transfers$635.10.6%$643.21.3%$1,278.32.1%Total Transfers$651.5$659.9$0.0$0.0Total Transfers1.3%1.3%(100.0)%ERROR:#DIV/0!%

TOTAL GENERAL FUND$19,348.44.0%$19,953.5$20,509.0$555.53.1%6.0%TOTAL GENERAL FUND$20,712.2$20,794.7$82.53.8%1.4%TOTAL GENERAL FUND$21,518.0$21,607.2$89.23.9%3.9%$42,230.2$42,401.9$171.7TOTAL GENERAL FUND$22,283.43.1%$23,034.83.4%$45,318.26.9%TOTAL GENERAL FUND$23,774.4$24,529.1$0.0$0.0TOTAL GENERAL FUND3.2%3.2%(100.0)%ERROR:#DIV/0!%

$ Change From Previous Year$739.6$754.7$(24,529.1)$0.0

The Official forecast is based on the October 2017 IHS Markit Standard Outlook and the corresponding Virginia state forecast developed by the Department of Taxation with recommendations from GACRE. It includes actions of the 2018 General Assembly Session. Chapters 1 and 2.The Official forecast is based on the October 2017 IHS Markit Standard Outlook and the corresponding Virginia state forecast developed by the Department of Taxation with recommendations from GACRE. It includes actions of the 2018 General Assembly Session. Chapters 1 and 2.The Official forecast is based on the October 2017 IHS Markit Standard Outlook and the corresponding Virginia state forecast developed by the Department of Taxation with recommendations from GACRE. It includes actions of the 2018 General Assembly Session. Chapters 1 and 2.The December forecast is based on the October 2017 IHS Markit Standard Outlook and the corresponding Virginia state forecast developed by the Department of Taxation with recommendations from JABE and GACRE and contains the same policy assumptions in Chapter 836.

TOTAL BIENNIUM GENERAL FUND$48,303.5$0.0

The December forecast is based on the October 2017 IHS Markit Standard Outlook and the corresponding Virginia state forecast developed by the Department of Taxation with recommendations from JABE and GACRE and contains the same policy assumptions in Chapter 836.The December forecast is based on the October 2017 IHS Markit Standard Outlook and the corresponding Virginia state forecast developed by the Department of Taxation with recommendations from JABE and GACRE and contains the same policy assumptions in Chapter 836.The December forecast is based on the October 2017 IHS Markit Standard Outlook and the corresponding Virginia state forecast developed by the Department of Taxation with recommendations from JABE and GACRE and contains the same policy assumptions in Chapter 836.The Official forecast is based on the October 2017 IHS Markit Standard Outlook and the corresponding Virginia state forecast developed by the Department of Taxation with recommendations from GACRE. It includes actions of the 2018 General Assembly Session. Chapters 1 and 2.

$ Change From Previous Biennium$2,985.3$(48,303.5)

% Growth From Previous Biennium6.6(100.0)%

Input

Input Data

ACTUALACTUALACTUALActualActualActualActualActualActualThis two columns are for new biennium

FY85FY86FY87FY88FY89FY90FY91FY92FY93FY94FY95FY96FY97FY98FY99FY00FY01FY02FY03FY04FY05FY06FY07FY08FY09FY10FY11FY12FY13FY14FY15 actFY16 ACTFY17 7/17FY18 6/18FY18 7/18% growth$ DiffFY19 10/17FY19 6/18% growth$ DiffFY20 10/17FY20 6/18% growth$ DiffFY21 10/17% growthFY16 08/09FY16 12/09FY16 12/10FY16 02/11FY22 10/17% growth% growthFY17 12/10FY23% growthFY18 12/10FY24% growthFY25FY26

GROSS INDIVIDUAL2,343.32,610.02,963.43,198.13,556.43,642.13,734.63,827.54,099.04,338.04,581.94,927.25,344.96,043.76,799.87,530.98,061.77,881.97,970.18,602.19,586.610,591.211,347.411,794.711,448.511,082.911,813.67812,397.55513,059.013,009.214,086.014,376.414,913.915,460.616,013.47.4%552.816,171.716,238.51.4%66.816,939.517,003.54.7%64.017,692.74.1%15,199.414,468.114,741.614,800.318,437.24.2%ERROR:#REF!15,554.219,150.43.9%16,351.419,876.63.8%

WITHHOLDING2,512.52,737.32,851.22,958.93,099.13,347.83,562.63,798.64,049.04,303.04,759.05,311.95,861.36,254.96,422.46,567.47,039.37,513.08,061.08,565.58,933.69,138.19,176.29,635.05810,039.66810,251.310,484.211,044.311,306.311,895.412,313.312,540.55.4%227.212,810.212,870.22.6%60.013,308.513,368.53.9%60.013,821.13.4%12,199.511,523.911,881.111,933.714,347.73.8%ERROR:#REF!12,495.014,884.93.7%13,110.615,432.23.7%

Base7,513.08,061.08,565.58,933.69,138.19,176.29,635.0589,635.05810,286.311,044.311,306.311,895.412,259.712,760.212,760.213,258.513,258.513,771.112,199.511,533.811,891.011,899.614,297.712,504.914,834.913,120.515,382.2

Explicit adjustment80.050.050.050.01stQtr50.050.01stQtr50.044.050.050.050.0

Other (Partnership, Leg Chng, etc.)3.660.060.0(9.9)(9.9)(9.9)(9.9)(9.9)

NONWITHHOLDING685.6819.1790.8775.6728.3751.3775.3783.4878.11,041.91,284.71,487.81,669.71,806.81,459.51,402.71,562.82,073.52,530.22,782.02,861.22,310.41,906.82,178.6202,357.8872,807.72,524.93,041.63,070.13,018.53,147.33,472.915.1%325.63,361.53,368.3-3.0%6.83,631.03,635.07.9%4.03,871.66.5%2,999.92,944.22,860.52,866.64,089.55.6%ERROR:#REF!3,059.24,265.54.3%3,240.84,444.44.2%

Base EP2,024.62,472.92,782.02,861.22,310.41,906.82,178.6202,178.6202,484.51,572.51,850.02,000.01,948.52,034.4-100.0%(2,034.4)2,155.72,155.7ERROR:#DIV/0!2,345.22,345.28.8%2,505.82,957.82,872.12,788.32,813.02,632.72,987.02,727.13,168.62,825.2

FP48.957.3952.41,191.61,070.11,070.01,096.3-100.0%(1,096.3)1,199.61,199.6ERROR:#DIV/0!1,274.51,274.5ERROR:#DIV/0!1,581.71,680.01,768.61,856.4

Other (Partnership, Leg Chng, etc.)33.133.116.66.213.011.315.3(215.9)42.172.172.253.6(223.2)72.2(230.2)72.2(237.2)

REFUNDS395.1435.8517.6440.2449.5559.9498.6506.2514.3526.1553.8579.1617.1638.2711.9702.0835.41,171.11,194.41,217.21,234.21,282.61,559.81,679.91,967.41,994.71,869.3081,784.7191,719.11,755.81,757.31,820.71,861.01,968.71,907.62.5%(61.1)2,061.32,054.77.7%(6.6)2,153.92,147.34.5%(6.6)2,265.95.5%2,026.02,061.92,114.52,082.42,377.14.9%ERROR:#REF!2,222.82,472.54.0%2,337.12,571.84.0%

Base1,234.21,282.61,559.81,679.91,967.41,994.71,869.3081,869.3081,784.31,784.31,757.31,820.71,861.01,982.82,070.62,070.62,163.22,163.22,274.92,076.02,111.92,114.52,118.42,386.12,222.82,481.52,337.12,580.8

(36.0)

Conformity -EITC7.07.0(14.1)(9.3)(15.9)(9.3)(15.9)(9.0)(50.0)(50.0)(9.0)(9.0)(9.0)

NET INDIVIDUAL1,948.22,174.32,445.82,757.93,106.93,082.23,236.03,321.23,584.83,811.94,028.14,348.04,727.85,405.46,087.96,828.97,226.36,710.86,775.77,384.98,352.49,308.69,787.610,114.89,481.19,088.39,944.37010,612.83611,340.011,253.312,328.712,555.613,052.913,491.914,105.88.1%613.914,110.414,183.80.6%73.414,785.614,856.24.7%70.615,426.83.8%13,173.412,406.212,627.112,717.916,060.14.1%ERROR:#REF!13,331.416,677.93.8%14,014.317,304.83.8%

SALES930.61,023.01,105.71,192.11,292.91,357.61,336.51,348.81,441.61,539.11,657.71,722.01,826.81,919.22,065.32,201.52,273.02,429.82,336.02,562.32,946.12,812.73,049.13,075.52,903.43,082.53,012.3793,121.5033,219.83,066.53,235.43,295.93,357.13,458.23,461.83.1%3.63,547.13,547.32.5%0.23,625.03,625.22.2%0.23,700.82.1%3,653.93,560.63,692.53,668.53,777.92.1%ERROR:#REF!3,873.63,852.52.0%4,054.33,929.72.0%

Base2,768.72,890.83,016.83,058.52,903.42,858.73,012.3793,012.3793,187.33,250.03,235.43,295.93,357.13,457.03,525.43,525.4ERROR:#DIV/0!0.03,603.33,603.32.2%0.03,684.53,650.03,495.83,642.93,657.73,761.63,824.03,836.24,004.73,913.4

AST Unwind177.477.432.317.0(25.0)0.0

Leg Chg &TTF&.125FY14(155.4)223.8223.845223.845(1.2)(1.2)26.221.721.921.721.916.33.964.849.610.816.349.616.349.616.3

CORPORATE287.7280.8318.8336.1349.9310.4279.2275.9371.5312.1376.4402.3432.3450.8420.4565.9363.8290.2343.3425.7616.7871.6879.6807.9648.0806.5822.259859.923796.7757.5831.9764.9827.0874.0861.94.2%(12.1)912.0912.05.8%0.0926.4926.41.6%0.0943.71.9%921.3905.5937.7914.7960.01.7%ERROR:#REF!907.5982.82.4%925.91,007.82.5%

Base584.1846.6879.6807.9648.0806.5806.473806.473868.1868.1831.9764.9827.0873.3916.3916.3930.8930.8950.2908.2892.4939.0965.3967.7960.0990.5978.41,015.5

YTD Collect adj32.625.0(25.0)(25.0)

Other (Partnership, Leg Chng, etc.)(22.2)(22.2)0.7(4.3)(4.3)(4.4)(4.4)(6.5)13.113.1(1.3)(50.6)(7.7)(52.5)(52.5)(52.5)(7.7)(52.5)(7.7)

PUBLIC SERVICE138.4135.0145.6152.1107.0101.695.5102.497.8118.7108.6115.5126.3101.8111.9104.293.477.291.286.988.390.088.096.491.397.393.77794.42996.298.298.592.695.198.098.73.8%0.798.098.0-0.7%0.098.098.00.0%0.098.00.0%95.494.296.493.998.00.0%ERROR:#REF!96.498.00.0%96.498.00.0%

INSURANCE108.6131.2158.5180.5190.3178.6157.7174.8180.3196.4208.2218.0219.0237.0244.9251.1268.1292.7333.0351.3373.6373.8384.9396.9255.0261.9281.563252.895262.2320.4300.6339.1340.9362.1337.9-0.9%(24.2)376.6376.611.4%0.0384.6397.65.6%13.0405.92.1%364.2354.4348.8340.3422.54.1%ERROR:#REF!369.5438.63.8%383.1455.83.9%

Base255.0261.9261.881261.881386.7386.7471.1489.5516.2530.1-100.0%(530.1)553.3553.3569.0582.0595.6531.4519.6512.5502.2621.0540.6645.6563.6671.0

Transportation Fund(131.1)(131.1)(150.6)(150.4)(163.1)(168.0)-100.0%168.0(176.7)(176.7)(184.4)(184.4)(189.7)2.8%(167.2)(165.2)(163.7)(161.9)(198.5)(171.1)(207.0)(180.5)(215.2)

ALCOHOLIC STATE60.865.062.261.861.962.364.063.964.362.362.665.966.167.371.477.382.886.487.895.9102.7110.0118.7125.3129.6131.6135.993143.388152.9157.4166.0175.3180.7189.7191.05.7%1.3197.5197.53.4%0.0205.9205.94.3%0.0205.90.0%136.7137.9143.2143.2205.90.0%ERROR:#REF!143.2205.90.0%143.2205.90.0%

BEER & BEVERAGE35.335.837.838.638.639.039.038.138.338.838.438.537.538.239.139.940.141.140.942.241.842.943.143.543.643.542.94442.99142.341.841.942.341.742.340.9-2.0%(1.4)42.342.33.5%0.042.342.30.0%0.042.30.0%44.343.443.543.342.30.0%ERROR:#REF!43.542.30.0%43.542.30.0%

WILLS59.876.6105.395.5101.291.671.983.799.6114.984.795.5103.4126.8157.9146.3167.6214.4285.8340.6596.1694.7582.9456.3314.3290.2291.457322.071377.5310.8346.3369.1394.4407.2394.90.1%(12.3)407.2407.23.1%0.0407.2407.20.0%0.0407.20.0%284.0284.0294.1322.9407.20.0%ERROR:#REF!294.1407.20.0%294.1407.20.0%

Base389.8426.7374.0294.0314.3290.2291.973291.973423.0377.0404.0441.0455.5455.5455.5455.5455.5455.5317.5317.5328.7361.3455.5328.7455.5328.7455.5

Tax Reform187.8249.0208.9162.310.0(47.2)

Transportation Fund(45.5)(40.5)(38.2)(44.6)(48.3)ERROR:#DIV/0!48.3(48.3)(48.3)(48.3)(48.3)(48.3)(33.5)(33.5)(34.6)(38.4)(48.3)(34.6)(48.3)(34.6)(48.3)

Other (Partnership, Leg Chng, etc.)18.419.1

INHERITANCE28.119.932.843.244.763.146.948.847.983.077.769.492.2122.3154.1150.1126.8133.7143.3149.6150.0160.4152.9153.46.05.72.7130.298(0.3)0.20.10.28.20.80.9-88.6%0.10.00.0-100.0%0.00.00.0ERROR:#DIV/0!0.00.0ERROR:#DIV/0!0.00.00.00.00.0ERROR:#DIV/0!ERROR:#REF!0.00.0ERROR:#DIV/0!0.00.0ERROR:#DIV/0!

Base155.5155.5

Leg Change - Repeal(155.5)(155.5)

TOBACCO16.917.217.117.016.516.215.315.214.814.915.816.016.015.715.415.215.115.015.316.16.30.00.00.00.00.00.0000.0000.00.00.00.00.00.00.0ERROR:#DIV/0!0.00.00.0ERROR:#DIV/0!0.00.00.0ERROR:#DIV/0!0.00.0ERROR:#DIV/0!0.00.00.00.00.0ERROR:#DIV/0!ERROR:#REF!0.00.0ERROR:#DIV/0!0.00.0ERROR:#DIV/0!

BANK FRANCHISE2.62.93.84.34.95.25.14.34.65.97.58.48.88.413.312.34.610.29.38.710.612.312.613.822.523.124.40318.88120.422.519.017.822.022.024.08.7%2.022.022.0-8.2%0.022.022.00.0%0.022.00.0%15.310.012.419.322.00.0%ERROR:#REF!12.422.00.0%12.422.00.0%

OTHER TAXES0.50.81.91.00.1(3.0)(5.7)0.8(2.4)(1.2)(4.2)(3.5)(3.3)(1.4)(0.6)(2.5)(2.8)(12.9)(9.0)15.331.115.16.71.75.83.1(2.790)1.075(0.5)6.511.214.19.212.415.467.7%3.013.113.1-15.1%0.013.513.53.1%0.013.93.0%6.94.66.42.613.90.0%ERROR:#REF!6.413.90.0%6.413.90.0%

LICENSES & PERMITS4.04.54.84.51.01.01.11.21.11.91.71.71.81.51.51.51.61.51.54.64.64.84.84.64.34.34.3504.2414.24.04.14.14.24.24.0-3.7%(0.2)4.24.24.8%0.04.24.20.0%0.04.20.0%4.34.34.34.34.20.0%4.34.34.34.20.0%4.34.20.0%

VEHICLE LICENSES3.94.14.34.40.00.00.00.00.00.00.00.00.00.00.00.00.00.00.00.00.00.00.00.00.00.00.0000.0000.00.00.00.00.00.00.0ERROR:#DIV/0!0.00.00.0ERROR:#DIV/0!0.00.00.0ERROR:#DIV/0!0.00.0ERROR:#DIV/0!0.00.00.00.00.0ERROR:#DIV/0!ERROR:#REF!0.00.0ERROR:#DIV/0!0.00.0ERROR:#DIV/0!

CORP. FRANCHISE7.112.111.811.912.315.912.813.016.618.219.018.819.914.322.121.622.922.436.739.143.146.447.947.049.446.644.40442.32947.150.248.653.653.451.253.60.5%2.451.251.2-4.5%0.051.251.20.0%0.051.20.0%43.443.443.443.451.20.0%43.443.443.451.20.0%43.451.20.0%

FEES: PROFESSIONS0.20.20.20.20.30.30.30.30.40.80.90.80.80.91.01.01.11.21.11.10.00.00.00.00.00.00.0000.0000.00.00.00.00.00.00.0ERROR:#DIV/0!0.00.00.0ERROR:#DIV/0!0.00.00.0ERROR:#DIV/0!0.00.0ERROR:#DIV/0!0.00.00.00.00.0ERROR:#DIV/0!ERROR:#REF!0.00.0ERROR:#DIV/0!0.00.0ERROR:#DIV/0!

PRIVILEGES1.21.51.41.5(0.0)0.00.00.00.00.00.00.00.00.00.00.00.00.00.00.00.00.00.00.00.0000.0000.00.00.00.00.00.00.0ERROR:#DIV/0!0.00.00.0ERROR:#DIV/0!0.00.00.0ERROR:#DIV/0!0.00.0ERROR:#DIV/0!0.00.00.00.00.0ERROR:#DIV/0!ERROR:#REF!0.00.0ERROR:#DIV/0!0.00.0ERROR:#DIV/0!

SERVICES2.33.03.34.24.13.15.66.17.38.29.19.19.910.110.09.911.312.911.212.013.314.115.615.813.711.711.13310.45610.911.311.511.011.711.612.34.6%0.711.611.6-5.5%0.011.611.60.0%0.011.60.0%11.711.711.711.711.60.0%11.711.711.711.60.0%11.711.60.0%

SALES PROPERTY0.70.40.20.11.40.10.30.00.40.40.10.00.90.53.01.10.10.31.02.011.87.0(0.0)0.00.00.82.8734.3730.12.80.41.20.00.35.459711.1%5.10.00.0-100.0%0.00.00.0ERROR:#DIV/0!0.00.0ERROR:#DIV/0!0.00.00.00.00.0ERROR:#DIV/0!ERROR:#REF!0.00.0ERROR:#DIV/0!0.00.0ERROR:#DIV/0!RIC needs

ASS. & REC. SP. SERV 0.80.60.30.70.70.60.50.50.30.40.40.50.40.20.30.20.40.40.40.30.30.30.20.50.40.40.4360.3500.30.40.50.40.20.40.6220.3%0.20.40.4-31.4%0.00.40.40.0%0.00.40.0%0.40.40.40.40.40.0%ERROR:#REF!0.40.40.0%0.40.40.0%

INSTITUTIONAL2.72.62.72.72.72.93.95.05.55.56.711.011.710.68.49.17.99.27.99.69.28.27.27.66.46.06.4465.8425.75.67.45.32.32.12.822.1%0.72.12.1-23.9%0.02.12.10.0%0.02.10.0%6.26.26.26.22.10.0%6.26.26.22.10.0%6.22.10.0%

INTEREST91.792.876.479.285.7101.737.442.448.153.464.582.3114.9105.8126.1131.2133.2100.481.761.483.996.8175.9189.3104.294.381.12277.15667.574.148.752.255.667.861.410.4%(6.4)66.266.27.8%0.072.772.79.8%0.072.70.0%94.594.594.594.572.70.0%94.594.594.572.70.0%94.572.70.0%

DIVIDENDS & RENT0.30.30.30.40.30.30.40.40.40.40.50.90.30.30.30.40.40.31.40.30.20.30.30.40.30.30.3620.3890.30.30.30.50.40.30.3-8.7%0.00.30.3-7.4%0.00.30.30.0%0.00.30.0%0.30.30.30.30.30.0%ERROR:#REF!0.30.30.0%0.30.30.0%

FINES31.533.936.240.444.346.649.350.991.998.0101.5101.2110.4119.1128.9127.3134.2152.8191.2206.7219.3187.0226.7220.4215.3204.9228.634222.289224.7215.9221.0226.2228.1219.1213.7-6.3%(5.4)221.7221.83.8%0.1226.7226.82.3%0.1226.7-0.0%219.7220.2227.5239.4226.70.0%ERROR:#REF!227.5226.70.0%227.5226.70.0%

OTHER REVENUE23.210.09.120.56.69.515.221.124.329.122.629.820.117.622.829.584.438.738.875.913.98.83.910.127.117.110.2938.73619.510.512.718.810.813.1(6.1)-156.5%(19.2)13.116.6-372.8%3.513.113.1-315.3%0.013.10.0%7.57.57.57.513.10.0%7.57.57.513.10.0%7.513.10.0%

EXCESS FEES2.32.33.22.43.52.42.33.0(6.8)(11.3)(8.8)(7.6)(8.1)(10.0)(12.8)(10.9)(11.1)(18.6)(27.5)(34.9)(37.9)(41.6)(33.1)(24.4)(17.1)(10.5)(8.625)(8.670)(10.8)(7.1)(6.8)(7.4)(7.9)(7.9)(7.7)-3.5%0.2(7.9)(7.9)3.2%0.0(7.9)(7.9)0.0%0.0(7.9)0.0%(17.1)(6.5)(7.5)(7.5)(7.9)0.0%ERROR:#REF!(7.5)(7.9)0.0%(7.5)(7.9)0.0%

DONATIONS0.00.00.0(0.0)0.04.50.00.00.00.0(0.0)0.10.00.00.00.0(0.0)0.00.00.00.00.00.00.00.10.10.0860.0220.00.00.00.00.00.00.0ERROR:#DIV/0!0.00.00.0-100.0%0.00.00.0ERROR:#DIV/0!0.00.0ERROR:#DIV/0!0.00.00.00.00.0ERROR:#DIV/0!ERROR:#REF!0.00.0ERROR:#DIV/0!0.00.0ERROR:#DIV/0!

CITIES, COUNTIES1.01.01.11.11.21.31.31.41.31.31.411.513.510.810.19.48.89.19.19.09.410.010.310.110.39.89.6188.8627.98.37.77.47.47.47.3-1.8%(0.1)7.47.41.7%0.07.47.40.0%0.07.40.0%9.69.69.69.67.40.0%9.69.69.67.40.0%9.67.40.0%

TOBACCO MASTER66.951.359.860.051.40.60.00.00.00.00.00.0000.0000.00.00.00.00.00.00.0ERROR:#DIV/0!0.00.00.0ERROR:#DIV/0!0.00.00.0ERROR:#DIV/0!0.00.0ERROR:#DIV/0!0.00.00.00.00.0ERROR:#DIV/0!ERROR:#REF!0.00.0ERROR:#DIV/0!0.00.0ERROR:#DIV/0!

ABC PROFITS25.329.629.426.326.127.526.223.726.820.719.026.023.820.725.530.228.125.414.216.824.930.027.636.144.150.050.50363.80068.072.283.386.5110.5104.1109.5-0.9%5.4109.8109.80.3%0.0115.5115.55.2%0.0115.50.0%37.041.449.349.3115.50.0%ERROR:#REF!49.3115.50.0%49.3115.50.0%

LOTTERY PROFITS156.5294.6290.8297.1303.3311.6331.6342.5318.9321.9324.3329.4367.2375.1407.8423.5454.0434.9458.20.00.00.0000.0000.00.00.00.00.00.00.0ERROR:#DIV/0!0.00.00.0ERROR:#DIV/0!0.00.00.0ERROR:#DIV/0!0.00.0ERROR:#DIV/0!0.00.00.00.00.0ERROR:#DIV/0!ERROR:#REF!0.00.0ERROR:#DIV/0!0.00.0ERROR:#DIV/0!

TRANSFERS24.418.140.640.346.412.1335.4339.780.184.7(38.2)111.321.749.049.183.125.1334.8653.4588.2291.1381.6357.8318.3362.4517.2361.626437.500356.6465.5550.6475.1542.8521.2518.8-4.4%(2.4)505.9511.2-1.5%5.3510.2515.50.8%5.3519.60.8%346.9337.3347.3347.3527.71.6%ERROR:#REF!360.5536.01.6%373.8544.41.6%

0.25% Sales Tax .375Ft14147.6217.2225.2226.7213.4209.4204.026214.100221.4334.0352.4355.5365.9379.1376.62.9%(2.5)386.7386.72.7%0.0395.2395.22.2%0.0404.62.4%266.5256.9266.9266.9412.72.0%ERROR:#REF!280.1421.02.0%293.4429.42.0%

All Other24.418.140.640.346.412.1335.4339.780.184.7(38.2)111.321.749.049.183.125.1334.8653.4588.2143.5164.4132.691.6149.0307.8157.600223.400135.2131.5198.2119.6176.9142.1142.2-19.6%0.1119.2124.5-12.4%5.3115.0120.3-3.4%5.3115.0-4.4%80.480.480.480.4115.00.0%ERROR:#REF!80.4115.00.0%80.4115.00.0%

TOTAL GENERAL FUND3,840.54,179.54,660.45,121.05,551.45,691.06,128.16,277.46,537.66,912.17,173.67,825.18,337.39,161.510,099.211,226.111,487.911,406.411,909.812,930.714,426.815,700.016,386.116,579.514,721.614,786.715,452.316,347.96517,109.216,949.118,369.518,601.719,348.419,953.520,509.06.0%555.520,712.220,794.71.4%82.521,518.021,607.23.9%89.222,283.43.1%19,459.818,571.118,996.619,073.023,034.83.4%ERROR:#REF!19,885.723,774.43.2%20,794.624,529.13.2%

FY87 RFP and 96 Harper and 97 Trigon0.00.086.10.03.50.070.90.00.00.0(78.3)174.80.00.00.00.00.00.00.00.00.00.00.00.00.0000.00.00.00.00.00.00.0ERROR:#DIV/0!0.00.00.0ERROR:#DIV/0!0.00.00.0ERROR:#DIV/0!0.00.0ERROR:#DIV/0!0.00.00.00.00.0ERROR:#DIV/0!ERROR:#REF!0.00.0ERROR:#DIV/0!0.00.0ERROR:#DIV/0!

TOTAL WITH RFP3,840.54,179.54,746.55,121.05,554.95,691.06,199.06,277.46,537.66,912.17,173.67,746.88,512.19,161.510,099.211,226.111,487.911,406.411,909.812,930.714,426.815,700.016,386.116,579.514,721.614,786.715,452.316,347.96517,109.216,949.118,369.518,601.719,348.419,953.520,509.06.0%555.520,712.220,794.71.4%82.521,518.021,607.23.9%89.222,283.43.1%19,459.818,571.118,996.619,073.023,034.83.4%ERROR:#REF!19,885.723,774.43.2%20,794.624,529.13.2%

TOTAL GF REVENUE3,790.84,131.74,590.45,054.45,478.95,494.95,471.95,623.26,133.66,503.46,881.17,356.17,949.38,773.59,702.810,788.511,105.310,679.010,867.111,917.913,687.314,834.315,565.815,767.014,315.114,219.515,040.215,846.66516,684.61016,411.41517,735.618,040.118,695.07519,328.219,880.86.3%552.620,096.520,173.71.5%77.220,892.320,976.24.0%83.921,648.33.2%19,075.918,192.418,600.018,676.422,391.63.4%ERROR:#REF!19,475.923,122.93.3%20,371.523,869.23.2%

TOTAL GF REV - no TOBACCO MASTER10,721.511,054.010,619.210,807.111,866.513,686.714,834.315,565.815,767.014,315.114,219.515,040.215,846.66516,684.616,411.41517,735.618,040.118,695.119,328.219,880.86.3%552.620,096.520,173.71.5%77.220,892.320,976.24.0%83.921,648.33.2%19,075.918,192.418,600.018,676.422,391.63.4%ERROR:#REF!19,475.923,122.93.3%20,371.523,869.23.2%

INTEREST & RENTS92.193.176.779.686.0102.037.842.848.553.865.083.1115.2106.2126.4131.5133.5100.783.161.784.197.1176.2189.7104.694.781.577.54567.874.449.052.656.068.161.710.3%(6.4)66.566.57.7%0.073.073.09.8%0.073.00.0%94.894.894.894.873.00.0%ERROR:#REF!94.873.00.0%94.873.00.0%

MISC TAX & PENALTIES32.134.638.141.444.443.543.651.789.596.897.397.7107.1117.8128.4124.8131.3139.9182.2221.9250.4202.1233.4222.0221.1208.0225.8223.364224.2222.3232.2240.3237.3231.5229.2-3.4%(2.3)234.8234.92.5%0.1240.2240.32.3%0.1240.60.1%226.6224.8233.9242.0240.60.0%ERROR:#REF!233.9240.60.0%233.9240.60.0%

OTHER MISC REVENUES46.433.832.845.430.735.538.544.748.755.250.367.861.755.862.6133.3172.5137.4136.9167.855.740.230.136.551.639.834.432.79938.733.332.838.830.132.819.4-35.4%(13.4)32.536.085.1%3.532.532.5-9.7%0.032.50.0%29.229.229.229.232.50.0%ERROR:#REF!29.232.50.0%29.232.50.0%

TOTAL MAJOR3,335.03,685.94,134.14,562.05,041.25,020.55,081.25,204.45,677.75,974.46,355.16,785.97,309.38,139.28,976.39,993.710,298.79,938.010,073.911,064.812,884.814,061.414,684.114,851.413,601.913,529.314,352.015,169.22815,996.215,708.517,043.017,324.617,972.218,593.419,162.36.6%568.919,353.319,426.91.4%73.620,128.820,212.64.0%83.820,884.43.3%18,396.817,510.717,900.217,964.321,627.73.6%ERROR:#REF!18,776.122,359.03.4%19,671.723,105.33.3%

TOTAL MISC455.9445.7456.4492.4437.7474.4390.6418.8456.0528.9526.0570.2640.0634.3726.4794.8806.6741.0793.3853.1802.5772.9881.7915.5713.2690.2688.2677.437688.4702.9692.7715.5722.9734.8718.5-0.6%(16.3)743.2746.83.9%3.6763.5763.62.2%0.1763.90.0%679.1681.7699.8712.1763.90.0%ERROR:#REF!699.8763.90.0%699.8763.90.0%

TOTAL TRANSFERS49.747.770.066.672.5196.1656.2654.2404.0408.8292.5469.0387.9388.7396.5437.6382.6727.41,042.71,012.8739.5865.7820.3812.5406.5567.2412.1501.300424.6537.7633.9561.6653.3625.3628.3-3.8%3.0615.7621.0-1.2%5.3625.7631.01.6%5.3635.10.6%383.9378.7396.6396.6643.21.3%ERROR:#REF!409.8651.51.3%423.1659.91.3%

16,949.194.5

NWH/Total GF %0.10920.11340.12240.14020.14730.14870.15730.12800.11780.12090.14370.16120.16980.17260.15690.12900.14100.14420.16410.14900.15600.15770.16930.16230.16200.16870.16820.17370.1775

0.1544

NWH/Total RevenuesERROR:#DIV/0!ERROR:#DIV/0!ERROR:#DIV/0!ERROR:#DIV/0!ERROR:#DIV/0!0.15570.16350.13740.12980.13170.15150.17060.17870.18150.16140.13410.14490.14880.16830.15390.16150.16280.17470.16730.16700.17380.17330.17880.18260.18450.1862ERROR:#DIV/0!ERROR:#DIV/0!

0.1603

NWH to Net Ind0.27180.28420.28290.24370.20980.21910.22220.24760.22440.23130.23330.24620.23820.23750.24560.24470.25100.22770.23730.22650.22540.2546

0.2437

Final PaymentsIn $1,109.41,196.91,250.2874.8654.9877.4922.71,244.9952.41,191.6

% Ratio0.07480.07690.07930.06110.04610.05830.05820.07460.05800.06370.05670.00000.05970.05950.06100.06080.07310.0750

0.0651

193.3198.8201.0201.7208.9209.8216.5223.9

344.0344.0317.0317.0453.0453.0317.0453.0

150.7145.2116.0115.3244.1243.2100.5229.1

Models

Sheet1

FY 2018 Revenue Surplus Fully Obligated• Mandatory activities consumed the revenue surplus

• Vast majority of the $552.6 million surplus is required to meet RevenueStabilization Fund and Revenue Cash Reserve Fund requirements• $262.9 million will be deposited to the Rainy Day Fund to meet the FY 2020

mandatory deposit requirement based on FY 2018 performance• $234.4 million from surplus went to the Revenue Cash Reserve Fund

established pursuant to House Bill 763, 2018 General Assembly• Chapter 2 included $90.0 million for the Revenue Cash Reserve• $156.4 million had been appropriated to the Revenue Cash Reserve Fund in

FY 2018• Water Quality Improvement Fund deposit based on surplus revenues

totals $55.3 million, using remainder of revenues• An additional $18.5 million goes to the WQIF based on unencumbered

agency balances• Results in a total appropriation of $73.8 million in FY 2020

31

In FY 2020, Total Reserves Are Estimated Will Exceed $1.0 Billion

$0

$200

$400

$600

$800

$1,000

$1,200

$80.1 $85.0

$156.6

$224.3

$361.5

$574.6

$715.6

$472.4

$247.5

$340.1

$482.3

$1,064.7

$1,189.8

$1,014.9

$575.1

$295.2 $299.4 $303.6

$440.0

$687.5

$467.7

$235.5

$548.8

$439.7

$722.4

$1,033.8

Mill

ions

Total of All ReservesRevenue Stabilization Fund Revenue Cash Reserve

Revenue Stabilization Fund totals $551.9 million, Revenue Cash Reserve will total $481.9 million by FY 2020.

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Biennial Adjustments Resulting from Higher than Anticipated FY 2018 Base

33

• Although the FY 2018 surplus exceeded $555 million, the full amount of that surplus does not flow through to the FY 2019 base

• Two major adjustments have to be made:• Exclude $120 million in withholding collections accruing in FY 2018 that

otherwise would have been in FY 2019 except for the timing of the July 4 holiday

• Discount non-withholding to reflect the continued use of the “collar” and the exceptionally high collections in FY 2018 – that requires removing $193.0 million from assumed base to continue “collaring” non-withholding• The collar is calculated by capping non-withholding at the 10-year average share of

total revenues generated by that source. Currently that is 15.89%• Actual collections in FY 2018 were 17.47% of GF revenues

• After making these adjustments, the base increases only $242.0 million above the FY 2018 forecast when calculating new forecast for FY 2019 and FY 2020

Revised GF Revenue Outlook 2018 – 2020 Biennium

34

Fall Reforecasting Process• The Code-required Fall reforecasting process is currently underway

• Joint Advisory Board of Economists (JABE) met on October 11th to review the latest economic assumptions and revised methodologies• Board includes economists from both private sector and academia, as well as input

from IHS Markit and Moody’s Analytics

• Department of Taxation and Secretary of Finance will develop a revised forecast based on input received

• Governor’s Advisory Council on Revenue Estimates (GACRE) will meet November 19th• Cross-section of leaders from Virginia business and industry, and General

Assembly leadership• Members review the forecast developed by Governor’s staff and provide input on

the proposed forecast and predicted economic climate• Revisions to the Official forecast will be submitted with the Governor’s

proposed amendments to Chapter 2• Governor will present to Joint Money Committees on December 18th

35

National Economic Outlook:Revisions to the 2018-20 Biennium

• Overall projections for the national economic picture have been upgraded slightly since the Official Forecast was developed based on IHS Markit’s October 2017 assessment

• Upward adjustments have been incorporated for employment and GDP; total income growth remains largely unchanged; and wage growth has been reduced marginally for both FY 2019 and FY 2020

Job Growth GDPTotal

Wage/Salary Income Growth

FY 2019IHS October 2017 Standard 1.2% 2.3% 4.9% 4.5%IHS October 2018 Standard 1.6% 3.0% 4.6% 4.4%

FY 2020IHS October 2017 Standard 1.0% 2.2% 4.9% 5.0%IHS October 2018 Standard 1.3% 2.4% 4.8% 4.9%

36

Projected National Economic Variables


Virginia’s Economic Outlook:Revisions to the 2018-20 Biennium

• Sizeable improvements in Virginia’s jobs outlook are projected compared to last year’s forecast for the biennium

• These are offset by marginally reduced average wage estimates • Slight improvements assumed for personal income and total wages and salaries in both

years

Job GrowthAvg

Wage/SalaryTotal

Wage/Salary Income Growth

FY 2019Official Forecast (October 2017) 1.0% 3.4% 4.4% 4.3%September 2018 Standard 1.7% 2.9% 4.6% 4.4%

FY 2020

Official Forecast (October 2017) 0.8% 3.1% 4.0% 4.6%September 2018 Standard 1.2% 3.0% 4.2% 4.7%

37

Projected Economic Variables(National Forecast, adjusted for Virginia specific data)


FY 2019 Performance Through October• The budget forecast in Chapter 2 was predicated on revenue growth of

4.4% in FY 2019• Because FY 2018 actual collections exceeded the revenue forecast

substantially, we now can meet the budget forecast – the actual revenue numbers – with a growth rate of 1.5%• The increase in the base against which FY 2019 growth is measured means we

will generate more revenue than assumed in Chapter 2 even absent any changes to the underlying economic forecast

• Through the first third of the fiscal year, revenues have increased 4.5%and are exceeding the official forecast by 3 percentage points • Year-to-date strengths are seen in our 3 largest sources: withholding,

nonwithholding, and sales taxes

• Weaknesses apparent in corporate and recordation taxes

• Meeting the current forecast for FY 2019 requires growth of only 0.2% in the remaining 8 months of the fiscal year

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FY 2019 Year-to-Date Performance General Fund Revenue Forecast for Fiscal Year 2019

SourceGrowth Rates Assumed in

Ch. 2 Forecast

Growth Required to Meet Ch. 2

Revenue Forecast

ActualPerformance

Through October

Nov-June Required to

Meet Forecast

Withholding 4.5% 2.6% 4.1%* 2.0%*

Nonwithholding 6.8% (3.0%) 15.5% (6.7%)Refunds 4.7% 7.7% 6.6% 7.8%

Net Individual 5.1% 0.6% 5.5% (3.1%)

Sales 2.6% 2.5% 4.7% 1.6%Corporate 4.3% 5.8% (10.9%) 13.4%

Wills (Recordation) 0.0% 3.1% (7.4%) 9.0%Insurance 4.0% 11.4% -- 11.4%

Total GF Revenues 4.4% 1.5% 4.5% 0.2%

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*Note: Withholding figures do not reflect $120.0 million deposit made in June that should have been made in July. Adjusting for that timing anomaly, YTD withholding growth rate would be 7.2% and withholding would have to increase only 0.6% for the remainder of the year

Withholding Tax Forecast• Withholding tax collections grew 4.1% through October, with year-to-date growth

diminished by July collections which fell 5.5%• Current economics support an underlying growth rate of 4.6% in FY 2019 and 4.2%

in FY 2020 for withholding taxes• Assume actual growth of 4.0% for FY 2019 - lower than the economic growth

because of a timing anomaly, and 4.1% growth in FY 2020• This translates into an increase of $174.2 million in FY 2019 and $210.7 million in

FY 2020 compared to the revenues assumed in Chapter 2

4.0%

2.0%

6.5%

9.0%

1.1%

4.9% 5.3%

0.0%1.0%2.0%3.0%4.0%5.0%6.0%7.0%8.0%9.0%

10.0%

Q1, 2018 Q2, 2018 Q3, 2018 Q4, 2018 Q1, 2019

Virginia Quarterly Year-Over-Year Withholding Growth

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Note: Actual collections in Q4 FY 2018 and Q1 FY 2019 were distorted because of timing of the year-end close/July 4 holiday. $120.0 million that typically would have accrued to FY 2019 was booked in FY 2018.

ActualsTiming Adjusted

Sales Tax Forecast• Sales tax collections grew 3.1% in FY 2018 following two tepid years of

sub-2% growth• Chapter 2 assumed sales tax growth of 2.6% in FY 2019 and 2.2% in FY 2020

• The pace of personal income growth is projected to increase in both FY 2019 and FY 2020 and consumer confidence remains high

• Through October, sales tax collections have grown 4.7%• Sales tax collections would have to grow only 1.6% during the last 8

months of the year to meet the current forecast• Recommend raising the forecast to 4.0% in FY 2019 and assume smaller

changes in the growth rate for FY 2020 at this point – 3.2% growth• Results in additional revenues of $52.9 in FY 2019 and $90.3 in FY 2020 compared to

Ch. 2 • These projections make no explicit assumptions about revenue that would

be generated from expanded taxation of internet sales• However, an increasing number of online retailers have begun voluntarily remitting

sales tax further supporting assumptions of higher growth as collections come more aligned with rates of total retail sales

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Non-Withholding Forecast• Chapter 2 assumes non-withholding growth of 7.0% in FY 2019 and 7.9% in FY 2020

• FY 2018 actuals were far better than anticipated –growth of 15.1% compared to a forecast of 4.3%

• As a result, FY 2019 collections could decline by 3.0% and still meet the revenue figure assumed in Chapter 2

• Year to date, non-withholding collections have increased by 15.5%, well ahead of the forecast • The first estimated payment of the fiscal year was due in September, and monthly collections grew 15.4% on a

year-over-year basis• But an average of 82% of non-withholding taxes are collected in the last 8 months of the year,

and fully 55% are remitted in the last quarter• Year-to-date S&P gains have been largely lost in the recent correction and market performance is a major factor in

final payments

• Can’t assume FY 2019 growth will continue at this pace when you consider that FY 2018 collections made up 17.5% of total GF revenues – a share that has been exceeded only twice over past 20 years

• Policy of collaring non-withholding continues to be used to hedge against revenue shortfalls• Assume collared growth in the range of 2.1% in FY 2019 and 4.8% in FY 2020, increasing the

forecast by $176.4 million in FY 2019 and $88.2 million in FY 2020• Will have better idea of performance after January payment – could be readdressed in Mid-

Session reforecast

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Corporate Income Forecast• Most difficult revenue source to predict because collections affected by complex

tax planning decisions made by large firms, and those decisions are largely driven by minimizing federal tax liabilities

• Through the first four months of FY 2019, collections from this source have decreased 10.9%, behind the annual estimate of 5.8% growth• Tax reports that the YTD contraction in corporate tax collections appear to be broad-based across

all sectors

• Based on the collections through the first third of the fiscal year, recommend reducing the forecast for FY 2019 to -6.0%

• Assume slight improvement in collections in FY 2020 with growth in the 4% range

• Result is a forecast reduction of $101.8 million in FY 2019 and $83.8 million in FY 2020

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Other Expected Forecast AdjustmentsRecordation:• Through October, collections have fallen 7.4%, compared to a forecast of 3.1%

growth adjusted for the FY 2018 shortfall in this source• Chapter 2 forecasts flat collections in both FY 2019 and FY 2020

• While YTD Virginia price increases have been in the 4-5% range, sales volumes have declined by a similar percentage

• Rising interest rates are suppressing refinancing collections• Expect a reduced forecast for this source –

• Expect contraction of about 6% in FY 2019 and flat collections in FY 2020• Results in a downward revenue adjustment of about $36 million each year

Insurance Premium Tax:• Expect growth of 13.0% in FY 2019 and 2.5% in FY 2020 compared to Ch. 2

forecast of 11.4% and 7.8% respectively• Produces revenue increase of $5.3 million in FY 2019 and a reduction of $14.6

million in FY 2020• Impacted by the cap on historic rehabilitation tax credits as well as lag in

calculated amounts transferred to transportation

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Anticipate Revenues of $602.1 Million Above Chapter 2 Forecast

($ in Millions)HAC

FY 2019FY 2019 Growth

FY 2019Add’l $

HACFY 2020

FY 2020Growth

FY 2020Add’l $

Withholding $13,044.4 4.0% $174.2 $13,579.2 4.1% $210.7Nonwithholding $3,544.7 2.1% $176.4 $3,713.4 4.8% $88.2Refunds ($2,054.7) 5.0% $51.7 ($2,147.3) 5.2% $40.2Net Individual $14,534.4 3.0% $402.3 $15,145.3 4.2% $339.1 .

Sales $3,600.2 4.0% $52.9 $3,715.5 3.2% $90.3Corporate $810.2 (6.0%) ($101.8) $842.6 4.0% ($83.8)Recordation $371.2 (6.0%) (36.0) $371.2 0.0% (36.0)Insurance $381.8 13.0% $5.3 $391.4 2.5% ($14.6)Total Major Sources $19,697.8 2.8% $322.7 $ 20,466.0 3.9% $295.0

Other Revenue $743.3 3.5% ($3.5) $755.0 1.6% ($12.1)

Total GF Revenues $20,441.1 2.8% $319.2 $21,221.0 3.8% $282.9

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Anticipated Budgetary Pressures in the 2019 Session

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2019 Session: Amending the Adopted Budget• In odd-numbered sessions, action is taken to amend the previously

adopted biennial budget for the current and next fiscal year• 2018 General Assembly focused on fully-funding needs in both years

of the biennium, so adjustments to spending should be far more minor than in “big budget” years

• Chapter 2 already includes:• Full-year pay raises in FY 2020 for teachers and state and state-supported local

employees as well as fully-funding increases in health care and other fringe benefits

• Funding for Reserves – both Rainy Day Fund and Cash Revenue Reserve –which bring total reserves to $1.0 billion by end of FY 2020

• Full funding of K-12 re-benchmarking for the biennium• Additional funding in the second year for higher education totaling $130 million• FY 2018 surplus provides additional $73.8 million for WQIF in FY 2020

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Agency Budget Requests• As part of the annual budget development process, agencies are asked to

submit “decision packages” outlining their budget requests for the remainder of the biennium

• In October, agencies submitted preliminary general fund budget requests totaling $201.4 million in FY 2019, and $1.1 billion in FY 2020• This includes caseload adjustments, unavoidable cost increases, technical adjustments,

information technology requests and other spending for new or expanded initiatives• Not limited to mandatory spending – includes agency wishes

• These amounts exclude items like the Medicaid forecast and any adjustments to K-12 based on average daily membership updates, etc.• Medicaid forecast has subsequently been released and will be discussed later in this

presentation

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2019 Session Revenue and Budget Outlook - Virginiahac.virginia.gov/committee/files/2018/11-13-18...

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