Kansas has had to endure a lot of depressing budget reports lately. Every month, the state seems to fall short on its anticipated revenues. In October, just after the state Department of Revenue reported that tax receipts had fallen $45 million below projections, a state task force recommended that the department stop releasing such information altogether. That suggestion came just after Gov. Sam Brownback’s administration decided to kill a quarterly economic report that was also habitually filled with bad numbers.
Kansas received some criticism for trying to “end bad economic news by not reporting it,” as Bloomberg View put it. Brownback administration officials responded that the data was confusing and often failed to reflect current reality. But Kansas is not the only state afraid of the figures its own budget-crunchers present.
As part of last year’s budget, Connecticut ended its practice of current services projections. That’s a boring-sounding way of talking about how much programs will cost over time, assuming there are no policy changes. It’s a baseline against which to compare any proposed cuts or increases in spending. Ben Barnes, Connecticut’s budget director, said last year that it didn’t make sense to project shortfalls or surpluses into the future. “There’s no such thing, in my view, as a deficit or a surplus in years in which there is no appropriation in place,” Barnes said.
Some legislators complained that the new rules would be a blow against transparency in the budget. The change was adopted anyway. A majority of states already choose not to publish current services projections. “There is kind of a tendency for policymakers to focus on the immediate and not the future,” says Liz McNichol of the Center on Budget and Policy Priorities. “This reduces the outside pressure to look beyond one year.”
Lawmakers are always going to argue about the validity of budget forecasts. Governors often contend that projections out of the legislative fiscal office aren’t as accurate as their own numbers, especially when the legislative researchers turn out to be more pessimistic. When shifting a percent or two can have huge ramifications, everyone prefers to believe the rosier scenario.
But bad news has a way of catching up with policymakers, no matter how optimistic their initial assumptions. Connecticut will have to fill a shortfall of more than $1 billion in its budget this year, according to analyses from both the administration and the legislature. In Kansas, the shortfall is $350 million.