On November 19, 2010, the Departments of Administration and Revenue submitted a
report to the Governor, newly-elected Governor, and Legislature that identified revenue
projections for the 2010-11 fiscal year and the 2011-13 biennium. That report, required by
statute, identifies the magnitude of state agency biennial budget requests and presents a
projection of general fund tax collections.
On December 27, 2010, the administration modified the November 19 report and presented
a reestimate of general fund tax collections for 2010-11 and the two years of the 2011-13
biennium.
Our analysis indicates that for the three-year period, aggregate, general fund tax collections
will be $202.8 million lower than those reflected in the November/December reports. More than
half of the lower estimate ($117.2 million) is due to the impact of Special Session Senate Bill 2
(health savings accounts), Assembly Bill 3 (tax deductions/credits for relocated businesses), and
Assembly Bill 7 (tax exclusion for new employees).
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Compared with the administration's reports, tax collections are projected to be $12.9
million lower in 2010-11, $139.7 million lower in 2011-12, and $50.2 million lower in 2012-13.
2010-11 General Fund Condition Statement
Based upon the November/December reports, the administration's general fund condition
statement for 2010-11 reflects a gross ending balance (June 30, 2011) of $67.4 million and a net
balance (after consideration of the $65.0 million required statutory balance) of $2.4 million.
Our analysis indicates a general fund gross balance of $121.4 million and a net balance of
$56.4 million. This is $54.0 million above that of the administration's reports. The 2010-11
general fund condition statement is shown in Table 1.