Will the Bay State economy improve next year?

After examining the state’s slide into a recession last year and the emerging prospects for recovery taking root this year, The Beacon Hill Institute at Suffolk University today released its revised forecast of Massachusetts state tax revenues for fiscal year (FY) 2010 and a new forecast for FY2011.

The Institute’s forecasts for state tax revenues are:
• For FY 2010 (ending June 30, 2010): $18.545 billion, a 1.6%
increase over FY2009; and
• For FY 2011 (ending June 30, 2011): $19.211 billion, a 3.6%
increase over FY 2010.

David G. Tuerck, Executive Director of the Beacon Hill Institute (BHI)
and Chairman of the Department of Economics at Suffolk University,
and Paul Bachman, BHI Director of Research, presented the forecast
in testimony before the legislature’s Updated Consensus Revenue
Hearing. The hearing took place on the heels of falling September tax
revenues which came in $243 million below estimates used for the
current budget.

“With the national economy in recession, Massachusetts has not been
spared a dramatic loss in tax revenues,” said Tuerck. “Job losses will translate into continued lower personal income tax revenue for the Commonwealth in FY 2010,” said Tuerck in his testimony. “However, the evidence from recent data, combined with the recently enacted
sales tax increase, suggest that overall revenues will increase slightly in FY 2010.”

UPDATE: More from the AP and Reuters.

SECOND UPDATE: From the American Spectator and Globe.

THIRD UPDATE: More from the New York Post, Boston Herald and Joan Vennochi.