"There a reason state revenues are down, it's because a big portion of the economy sucks right now."
He attributes much of the decline in revenue to the price of crude oil. He says the low oil prices are beginning to affect corporate taxes, sales taxes, and income taxes.
"Obviously, when people are laid off they don't pay income tax and they buy fewer things so sales taxes go down."
The report does not include gambling revenues, fees, self-generated revenue, or statutory dedications the state receives. The state legislature will be looking at increasing state revenues in the upcoming legislative session. Kennedy advises legislators to be cautious in addressing this issue.
"They better be real careful, if they're just going to do massive tax increases, not tanking this economy. Because they could do it real easily and make it a lot worse."