State revenue forecast largely unchanged; experts flag volatile estate and corporate receipts

Tom Cabette of Tom Cabette and Associates told a joint meeting of the Senate Finance and Senate Appropriations committees that state revenue collections through the first six months of the fiscal year were ‘‘really close to expectations,’’ leaving the updated five‑year forecast largely unchanged from July.

Cabette pointed to very small variances across the state’s major funds — about 0.1 percent for the education fund, 0.2 percent for transportation and roughly 0.9 percent for the general fund — and said those tight margins are unusual given recent national and global turbulence.

The forecaster cautioned, however, that the state’s revenue picture depends heavily on a small number of volatile sources. ‘‘Estate tax is the most volatile revenue source,’’ Cabette said, explaining that large, irregular estate payments created an anomalous spike in the prior year that the office does not assume will repeat. He urged treating such receipts as timing‑driven outliers rather than predictable ongoing revenue.

Cabette also described sharp late‑year movements in corporate receipts tied to refunds and true‑ups: some large corporate payments in one year can be followed by substantial refunds the next, producing abrupt swings in collections even when aggregate corporate profitability remains steady.

The presentation and committee questions left no formal action; members asked staff follow‑up questions and were told the forecast materials and supporting tables are available for review. The committees may revisit details in subsequent budget briefings or follow‑up sessions.