Commission on Government Forecasting and Accountability
HOUSE
C.D. Davidsmeyer, Co-Chair
SENATE
David Koehler, Co-Chair
Skip Navigation Links
July 2022 Monthly Briefing
ECONOMY: SLOWDOWN OR RECESSION?
Benjamin L. Varner, Chief Economist

Economic data releases in July indicate the U.S. economy currently sits in a somewhat unique position. While job growth endures as labor markets continue to be tight, high inflation continues to be a problem. The effects of the Federal Reserve’s efforts to curtail inflation and slow the economy have become more apparent. The advanced report on real gross domestic product (GDP) showed the economy had shrunk for the second quarter in a row leading some economic prognosticators to say the economy is in recession though other measures of the economy remain respectable.

REVENUE: STRONG INFLUX OF FEDERAL REVENUES FUEL OVERALL INCREASE IN JULY RECEIPTS – ECONOMIC SOURCES EXPERIENCE MODEST GROWTH
Eric Noggle, Revenue Manager

Fiscal Year 2023 began the year on a positive note as July general funds revenues were up $395 million for the month. The reimbursement of $584 million in federal COVID-19 relief funds was the driver of this overall increase. These anticipated ARPA Reimbursement for Essential Government Services funds were originally expected to be receipted in FY 2022, which would have further enhanced the spectacular year of revenues for FY 2022. However, the inclusion of these one-time revenues in FY 2023 will provide an influx of revenues that were not assumed in the adopted FY 2023 budget – perhaps serving as a safety net as the State navigates through the next eleven months of this fiscal year.