The official estimate of Kansas revenues fell last week, as the state's Consensus Estimating Group lowered its outlook for fiscal 2012 by $21.5 million. The revenue estimate in the remainder of fiscal 2011 was also lowered by $10.2 million.

The state now expects to generate $5.78 billion in fiscal 2011 and $5.79 billion in fiscal 2012.

The revised forecast for fiscal 2011 represents an 11.2% increase from fiscal 2010 revenues.

The outlook was lowered from the November 2010 analysis as a result of the continuation of Bush-era federal income tax cuts that had been set to expire. Kansas income tax rates are based on the federal tax system.

The federal tax cuts are expected to reduce Kansas revenue by $77 million in fiscal 2011 and $53 million the following year.

The revenue conference said the state individual income tax will bring in $2.6 billion in fiscal 2011, with another $2 billion generated by the state sales tax.

The official estimate, which is used by the Legislature to develop the budget, shows that the proposed $6.14 billion Senate spending plan would result in a $23 million deficit at the end of fiscal 2012. The proposed $80 million surplus resulting from the $6.06 billion House budget would shrink to $48 million.

State budget director Steve Anderson, a member of the revenue estimating panel, said the Kansas economy is looking up.

"We are pretty optimistic that we're on the right track right now, and I see good things for the future of Kansas in revenues," Anderson said. "We see a growing economy."

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