by Paige Terryberry
Senior Analyst for Fiscal Policy, John Locke Foundation
The Office of the State Controller this week released its General Fund Monthly Financial Report for the 2021-2022 fiscal year that ended June 30th.
Notable data points include:
High revenues are not a bad problem to have – but they are no excuse for a spending bonanza. In fact, high revenues are partially the result of our conservative leadership’s great work to rein in spending and keep taxes low.
The latest state budget adjustments proposed a 7.6% year-over-year increase in spending for our current fiscal year of 2022-23. This is the largest such annual increase in more than a decade. Even so, legislators aggressively set aside funds for an economic downturn. Moreover, the current inflationary environment certainly puts upward pressure on the state budget.
The overall, uncertain economic situation warrants caution against significant increases in recurring spending commitments. As I wrote earlier this year, the current revenue surplus does bolster the case for a Taxpayer Bill of Rights that limits government spending and protects taxpayer dollars. If such surpluses occurred under a progressive legislature, there’s little doubt it would be spent on pet projects, bloating the budget and overextending future taxpayer obligations. A TABOR would prevent shortsighted spending sprees, regardless of who is in charge.