Economic slowdown leads to downgrade in revenue forecast

The state Council on Revenues has downgraded the state’s revenue forecast for this fiscal year.

The council voted 4-3 this afternoon to reduce the projection to 3.3 percent revenue growth in fiscal year 2014, down from 4.1 percent in September, an estimated $43 million loss to the state. The divided vote was because some economists on the council believed the forecast should have been even lower because of the slowdown in the rate of economic growth.

The council kept the projection of 7.4 percent revenue growth for fiscal year 2015, which starts in July.

State lawmakers and Gov. Neil Abercrombie use the council’s forecasts as guides when drafting the state budget.

State House and Senate leaders have said they intend to take a cautious approach to Abercrombie’s requests for new state spending because of concerns about the pace of economic growth. The state finished the last fiscal year with a record budget surplus of $844 million.