News Release

Harrisburg, PA - Treasurer Stacy Garrity today announced that Treasury has increased its investment income estimate for the current fiscal year by $270.1 million due to rising interest rates and the historically high General Fund balance.

Garrity urged the next Governor and General Assembly to deposit the unanticipated revenue in Pennsylvania’s Rainy Day Fund.

“It might be tempting to appropriate this money as part of next year’s state budget, but we must remember that these funds will not recur over the long term. We increased the investment income estimate for two reasons: Higher interest rates and the historically high balance in our General Fund. Although interest rates may remain high for the foreseeable future, we know that the General Fund balance is temporarily inflated by federal funds – and it will come down over the next few years.”

Pennsylvania State Treasurer, Stacy Garrity

As of July 1, the start of the current fiscal year, the balance in Pennsylvania’s General Fund was more than $18 billion. As of September 30, the balance was more than $11.7 billion. For historical perspective, between July 1, 2014, and December 31, 2020, the balance in the General Fund never reached $6 billion. (July 1, 2014, is the earliest data available on Treasury’s Transparency Portal.)

Treasury’s original investment income estimate for FY 2022-23 was $4.9 million, based on an assumed starting federal funds rate of 0.09% with no increases projected throughout the fiscal year. Treasury now forecasts investment income of $275 million for FY 2022-23, using a revised rate of 2.75%.

In the following fiscal year, the rate is expected to increase to 3.5%, resulting in a current investment income estimate of $316 million for FY 2023-24.

Garrity added that making regular deposits to the Rainy Day Fund can help boost Pennsylvania’s credit rating. $2.1 billion was added as part of the FY 2022-23 state budget, following a deposit of $2.6 billion as part of the FY 2021-22 state budget.