Projected deficit drops to $63.9M for FY2014

By Patrick Anderson
PBN Staff Writer
Twitter: @andersonpbn

PROVIDENCE – Rhode Island’s projected budget deficit for fiscal 2014 is $69.3 million, state budget officials said Wednesday, $61 million smaller than forecast last spring.

The budget gap, initially pegged at $130 million, has shrunk due in large part to a larger-than-expected current year surplus projection of $47.2 million.

A presentation to the House Finance Committee said state revenue projections for fiscal 2013, which started July 1, have risen $7.5 million from what was budgeted.

Although the larger surplus will relieve some pressure on the fiscal 2014 budget being developed now, the state’s structural deficit remains and the report shows growing gaps over the long term.

Due to a slower-than-expected Rhode Island economic recovery over the past six months, the budget report revises down forecasts for personal income, jobs and wage growth in the years ahead.

The new estimates predict Rhode Island will not recover all the jobs it has lost since 2007 until 2016, a year later than forecast in May.