FRANKFORT — The state government group charged with predicting Kentucky's annual tax revenue is a gathering of apolitical economic experts.
It's known as the Consensus Forecasting Group, and it gives the projections needed to begin the state's budgeting process.
The group of five men and two women say they enjoy the job even though it doesn't pay and involves the risk associated with making financial predictions in the billions.
But someone has to make the predictions that enable the state budget to be prepared, said James McCabe, one of the group's members and an associate professor of finance at the University of Louisville.
Gov. Steve Beshear called the group together last month to revisit a prediction, made in January, that the state would take in $8.9 billion in revenue in the 2008-09 fiscal year.
The group's revision was to drop the project by a large amount, $456 million. That has to be made up with very real tax increases, spending cuts or both before the fiscal year ends June 30.
Members say the severe downturn in the national economy could not have been predicted last January.
"We start with a forecast for the national economy, and the forecasts of the national economy did not anticipate this significant downturn," said Frank O'Connor, a professor of economics at Eastern Kentucky University.
The Consensus Forecasting Group was created in the 1990s to end the practice of allowing the executive and legislative branches to craft separate forecasts and argue over the differences. The group is apolitical.
"We can't forecast it exactly," Wilson said. "But I think people can take comfort in the fact that the numbers aren't cooked."
The group has a series of meetings every other year to make a preliminary forecast, and then a final one, for the two-year budget. But the governor or the Legislative Research Commission can call a special meeting to revise an earlier forecast, which is what Beshear did in November.