Looking Ahead at the Economic Outlook For Virginia

By: Carly Stephenson Email
By: Carly Stephenson Email

HARRISONBURG, Va. -- Tax revenue for Virginia has increased, especially after April, which was of course tax collection month.

Now Virginia is slightly ahead of what was forecasted in the budget.

With ten months to go though, there's a lot to consider.

Virginia will have to have about $3.6 billion in May and June of 2014 to meet their revenue target.

Usually, that number is $3.5 billion.

If they fall short, James Madison University Political Analyst Dr. Bob Roberts said they'll have to cut the budget.

Roberts said the issue is having enough revenue for next year, especially with news of furloughs for federal defense employees.

A lot of those employees live in Virginia.

If federal employees are furloughed, they'll be paying less in income taxes, which will result in less revenue.

It's a two year state budget cycle, and a lot can happen before July of 2014.

"We normally in a recovery get much larger surpluses then we're getting and we're not seeing them. And down the road it's not looking better because the fact that you're getting contracts aren't being let by the federal government, you're getting furloughs, so it's going to be a pretty tight fit probably for the next eight months for the state of Virginia," said Dr. Roberts.

The target to balance the budget is a total of $16.4 billion.

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