Wow, this is what a financial cliff looks like
In their final quarterly projections before leaving office, the Doyle Administration now predicts the state will begin the new year with nearly $700 million less than they forecast just three months ago.
Further, the Doyle Administration’s new forecast warns that at some point during the month of January, the state’s General Fund may be more than $427 million in the red.
The Department of Administration released the forecast, and information regarding the fund balance transfers in memos to the Joint Committee on Finance Co-Chairs Senator Mark Miller Representative Mark Pocan.
The new quarterly forecast just released by DOA shows the General Fund with a beginning balance in January of -$376,5 million, a difference of $695.3 million appearing only three months after their last forecast. In September, the state’s quarterly forecast indicated Wisconsin’s General Fund would begin the year with a positive balance of $318.8 million.
In the September memo to the Department to the Finance co-Chairs, DOA Secretary Dan Schooff projected the state’s General Fund would face a deficit as vast as $386.3 million during the month of December, which was up from the previously forecast deficit of $261.6 million in December, which was issued in August .
However, all previous correspondence between DOA and members of the Joint Committee on Finance had predicted that when overall cashflow was considered, the state would begin 2011 with a positive balance in the General Fund.
“Close enough for government work,” right?
Governor Jim Doyle’s fiscal mismanagement of the state will probably be the most lasting legacy of his time in office. Whatever “positive” accomplishments Doyle imagines he was responsible for are certainly put in danger by the looming budget crisis.
The next legislature is going to have a full plate. They will have to fix the current budget, which we now see was worse than anyone imagined. They will have to deal with the state employee contracts from the current budget cycle, which may end up helping deal with the current budget hole. The legislature will have to deal with the state’s employment problem that saw more private sector jobs lost in November. All this before they can even begin the work on the next state budget and tackling other issues. This is not going to be a session for wimps.