Treasury vs. OLS, Round 2: Rosen Warns of $637 Million Revenue Gap

This time last year, Gov. Chris Christie dismissed David Rosen, budget officer for the nonpartisan Office of Legislative Services, as the “Doctor Kevorkian of the numbers” for daring to suggest that his revenue estimates were overinflated by $537 million.

So what is he going to call Rosen this year, now that the OLS fiscal expert is projecting an even larger $637 million gap over the next 15 months?

Rosen and Treasurer Andrew Sidamon-Eristoff both expect strong income and sales tax growth over the next several months. But they offered conflicting estimates of likely state revenue collections for the last three months of Fiscal Year 2013 and for next year’s FY 2014 budget at a testy hearing of the Assembly Budget Committee.

Democratic and Republican members sparred repeatedly over how much the state’s economy was really improving and whether Rosen’s or Sidamon-Eristoff’s revenue predictions last year were closer to the mark.

Pressing the Democratic-controlled Legislature for an income tax cut, Christie started out in February of last year projecting $32.1 billion in state revenues for FY13, revised his revenue projections down to $31.7 billion in May after several months of subpar revenue collections, then conceded in his February budget speech this year that he expected revenues to come in $406 million short at $31.3 billion -- about where Rosen predicted they would come in.

Last week, however, Rosen told the budget panel that he now expects revenues over the next three months to come in $302.4 million below Christie’s latest revised forecast -- a projection that would wipe out the surplus in this year’s budget -- and that revenues for Christie’s FY14 election year budget would come in $334.8 million below his and Sidamon-Eristoff’s expectations.

Rosen emphasized that he was not being a “pessimist,” noting that to hit his own revenue projections for the remainder of FY13, “revenue growth has to be twice as strong in the last quarter as it was for first three quarters. If you use the administration numbers, revenue growth has to be three times as strong.”

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