Good news from the BEA —
Last week the S.C. Board of Economic Advisors reported the General Assembly would have considerably more resources at its disposal for the next fiscal year (2021-2022) than previously projected.
In January, the BEA anticipated additional revenues of $440.2 million, but at its April 8 meeting the BEA upped that number by nearly 50%, reporting that the state will end fiscal year 2021 with a surplus of $646.7 million. It now projects the state will have a whopping $1.7 billion in an unobligated revenue for fiscal year 2021-2022.
The $1.7 billion breaks down between $386 million in recurring funds that will be received next year and every year thereafter, and $1.33 in non-recurring, “one-shot” revenue.
Why does the state have so much more revenue available than previously thought? According to the BEA analysis, the pandemic downturn was very different from previous recessions. Taxable spending recovered very quickly and total wages and income did not decline as expected. Additionally, the federal stimulus funding boosted both government spending and the overall economy.
Nevertheless, the state has not regained jobs to the pre-pandemic level, with the hospitality sector being the slowest to recover.