Department of Revenue (DOR) Acting Commissioner Mike Barnhill released the Fall 2019 Revenue Sources Book Friday.
The Revenue Sources Book includes the Department’s fall forecast of oil price, oil production, and state revenue.
Unrestricted General Fund state revenue totaled $2.6 billion in FY 2019 and is forecast to be $2.1 billion for the current budget year, FY 2020 – a $500 million decline from last year – and $2.0 billion for FY 2021, the fiscal year which begins next July 1, a $600 million decline from FY 2019.
These figures exclude the annual transfers from the Permanent Fund Earnings Reserve. Those will bring an additional $200 million into the general fund in FY 2021, softening the sting of the revenue drop. The Permanent Fund is expected to transfer $2.9 billion to the General Fund in FY 2020 and $3.1 billion in FY 2021. These amounts include funds for both the payment of Permanent Fund Dividends and general government spending.
For FY 2019, Alaska North Slope (ANS) oil prices averaged $69.46 per barrel. The revenue forecast incorporates the most current indications from financial markets and is based on an annual average ANS oil price of $63.54 per barrel for FY 2020 and $59.00 per barrel for FY 2021.
The revenue forecast is based on relatively stable oil production from Alaska’s North Slope. New fields offer tremendous potential to increase production later in the 2020’s but these developments are still contingent on final investment decisions and commitment of billions of dollars of new investments on the part of oil and gas producers.