State Revenues Not Matching Economic Growth

Knoxville – The Tennessee Funding Board will revise the state-s budget estimates, after receiving economic reports on Tennessee-s financial picture.

University of Tennessee economist Bill Fox said the state-s economy is still healthy, but the rate of growth is slowing down.

“Economic performance in Tennessee remains very good,” Fox said. “The unemployment rate is at the lowest level in the history of the state, employment growth is still acceptable, so we-re doing fine.”

“However, we-re not experiencing growth rates of the level that we experienced a couple of years ago,” Fox said.

The state funding board has received reports from economists and will use the data to update the state budget estimates.

Fox said sales tax collections are not as robust as Tennessee-s overall economy.

“What we-re doing is reverting to historical norms, where economic growth is good, but revenue growth is a bit slower than economic growth,” Fox said.

The state is likely to see a revenue growth rate of about 4 percent, rather than the 5 or 6 percent rate seen in previous years.