A three-member panel says it is too soon to calculate what, if any, impact the coronavirus pandemic may have on state tax revenue.
“I think everybody in the world would like to know what the final outcome is going to be,” said Dave Roederer, the governor’s budget director who is a member of the panel, “but we aren’t going to know that until it happens, I guess.”
Legislative Services Agency director Holly Lyons, another voting member of the group, calls these unprecedented times.
“Much of the news is not good, however, I do want to be clear that the sky is not falling,” Lyons said. “It’s a little cloudier than usual, but Iowa currently has a stable, albeit slowly growing economy and the state’s financial position is sound.”
David Underwood, a businessman from Clear Lake, is the public member of the Revenue Estimating Conference. He said the fundamentals of the economy are solid.
“I haven’t seen anybody, at least in north Iowa, take down a ‘Help Wanted’ sign yet,” Underwood said. “There’s still plenty of those out there for anybody that wants to be employed.”
The panel actually raised its estimate of state tax collections for the current state fiscal year by $76 million. The group did reduce its guess for the next state budgeting year by $12 million. However, lawmakers who’ll use these figures to craft next year’s state budget will have more than $8.2 billion total to work with. Underwood predicted there will be an impact at some point, with as much fear as there is about covid-19.
“It still hasn’t really impacted Iowa yet. We don’t know the extent it’s going to,” Underwood said. “If it really becomes a pandemic in the United States, our numbers are going to be too high.”
Lyons admitted to being a bit stressed out, but she said the group is doing the best it can with the information it has.
“Yes, there’s fear, but there is no need to panic at this time,” Lyons said.
If the economy does slip, the group will reconvene. Any new estimate the panel might make would have an impact on state budgeting decisions.