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Missouri estimates $11.4B in general revenue for FY23

JEFFERSON CITY, Mo. — Gov. Mike Parson and the General Assembly’s budget chairs expect to see $11.4 billion in general revenue for the 2023 fiscal year, a more than 2 percent increase compared to estimates for the current year. 

FY22 estimates assumed $11.2 billion in net general revenue collections. The FY20 and FY21 estimates were heightened by delays in tax filing dates amid the COVID-19 pandemic, carrying collections over from one fiscal year to the next. 

The FY22 estimates represented a return to a single filing date, according to the Governor’s Office, as do next year’s.

Parson’s office worked with Senate Appropriations Chair Dan Hegeman and House Budget Chair Cody Smith to come to the projection. 

“I want to thank Sen. Dan Hegeman and Rep. Cody Smith for their hard work and cooperation in developing this revenue estimate,” Parson said. “With general revenue expected to increase and large amounts of Missourians’ federal tax dollars returning to our state, we have a great opportunity and responsibility to make smart, meaningful investments that serve Missourians now and into the future. We look forward to working with the General Assembly this session to create a balanced budget for the people of Missouri.”

The figure will be used to formulate the state’s budget, which Parson and the legislature will begin working on when session begins next month. 

“As we emerge from one of the most trying economic times in a generation, forecasting revenue growth is particularly important this year,” Smith said. “Therefore, I’m pleased to put forward a conservative revenue estimate to which the House, Senate, and governor have agreed.”

Despite the projections, business groups warned that supply chain issues and inflation would continue to cause headaches into the new year. 

Business owners expecting to see improved financial conditions next year fell by a point, according to a survey administered in November by business advocate NFIB Missouri, while 48 percent of businesses reported job openings that could not be filled. Around 54 percent also expect to raise prices to make up for the issues — a 48 year high, according to NFIB.

Only 9 percent of those surveyed reported no concerns or changes amid the supply chain disruption. 

While the breadth of Parson’s recommendations has yet to be seen, he joined Hegeman and Smith in committing to a 5.5 percent cost of living adjustment (COLA) and $15 minimum wage for state workers this month, an effort his office said was to build and retain the state’s workforce. The recommendation would cost $91 million, including $52 million from general revenue. 

Parson signed off on a $33 billion budget for FY22. An influx of federal funds is also on its way to the state for consideration over the next few sessions, including substantial investments in transportation, water, broadband, and more from the federal infrastructure package

The state closed out the 2021 fiscal year in a healthier position than last year; revenue fell drastically last spring as the COVID-19 pandemic gripped the country, and revenue remained low before rebounding by the end of the fiscal year. 

General revenue has remained healthy in 2021. Last month saw a 19 percent increase in collections compared to November 2020.