Every year after the budget passes, the number one question asked about revenue sharing by our members is, “when will there be an estimate of the amounts that will be allocated to each community?”. Good news, estimates have been released by the Senate Fiscal Agency! There are a few things to explain though.

As a reminder, this year’s budget provided a significant increase in revenue sharing and it created a new dedicated pot of resources for public safety. For all the details on the budget, you can click here to read our previous blog on the topic.

It is important to note that the Senate Fiscal estimate does not include the resources that will be provided from the $75M in new funding for public safety. Additionally, we have been in communication with the Department of Treasury, and they also intend to release revenue estimates. We anticipate those will be inclusive of all new revenue. Currently, Treasury does not expect to release any revenue estimates until after the Governor signs the budget. There is no firm date for her to do that, but we anticipate it will be in the next couple of weeks. Once Treasury posts their estimates, we will share that information with our members.

A couple of items to be aware of when you look at estimates from Senate Fiscal. First, the estimates include both constitutional revenue sharing and statutory revenue sharing. We must remember that we don’t have control over the amount of constitutional revenue sharing because it is based on a percentage of estimated sales tax collection for the upcoming fiscal year. Current estimates are projecting that constitutional revenue sharing will be down slightly, approximately $27M. While this is not a normal trend with sales tax collection, this leveling is something we anticipated in a post-covid environment. In future years, sales tax collection should return to a more normal pattern and continue to experience growth year over year.

To see your statutory revenue sharing increase in both dollar amount and percentage, look at the second to last column labeled “Non-CSnst Chg. From FY24”. This is where you will see the increase in statutory revenue sharing specifically related to the $34M in new resources for cities, villages, and townships. The very last column labeled “Total Chg. From FY24”, is a combination of both the increase in statutory revenue sharing and the decrease in constitutional revenue sharing. In most cases, the total change in revenue is +/- 1% or less, or roughly flat compared to last year.

While this document shows revenue essentially being flat this year, we must remember it is not inclusive of the public safety numbers. When we consider the new revenue from the public safety and violence prevention fund, most communities will experience an increase in revenue this year. It is also important to note that revenue for this budget will take effect at the beginning of the state’s fiscal year on October 1.

Here is a link to the Senate Fiscal Constitutional and Statutory Revenue Sharing Estimates. Senate Fiscal Revenue Sharing Estimates

We will update this information once Treasury releases their estimates.

John LaMacchia is the League’s director of state & federal affairs. He can be reached at [email protected] or 517-908-0303.