Biennial Revenue Comparisons (from Jarrod Thomas Show)
The radio discussion today focused on the importance of forecasts and the forecast process in decision-making, particularly budgeting. Most of this related to various aspects of the forecasting and budgeting process at the state level in North Dakota and how it impacts other entities like UND. There was also some appropriate trashing of the forecasters that gave such erroneous predictions and then decide the state is in recession. I discussed some data which I want to make available here. There is more that will be put online as I get it created.
So what am I trying to provide in this graph? There are three series. The blue line provides the percentage change in actual revenue from one biennium to the next. The red line presents the percentage change in forecast revenue from one biennium to the next. The green line provides the percentage change in the revenue amount forecast when compared to the actual amount from the prior biennium.
Two notes are in order here. First, the graph should be read as .2 is 20 percent, not .2 percent. Second, for the 15-17 biennium the blue line is the revised forecast compared to the actual from the prior biennium. The red line is still the comparison of forecast to forecast. The green line is the also the forecast compared to the prior actual revenue.
The graphs show the forecast change over two biennia matching the prior actual change pretty closely. That is, the change from last time became the current predicted change to some extent. Let me just stop right here and shudder. That is horrible forecasting. Good forecasts understand where you have been and what is currently happening, but must use that information to understand how it impacts the future. I will show in some other posts similar types of data for key components of total revenue such as sales tax revenue or income taxes and I will probably get even more upset as I write.