Budget Numbers (Still) Improving

budget paThe PA Revenue Department May 4 announced that collections in April exceeded expectations by $201 million.  This brings year-to-date revenues to $569.1 million above estimate.  This extra revenue was seen in Corporate Net Income Tax, Personal Property Tax, and Sales & Use Tax.  Two areas where revenues came in lower than anticipated were Real Estate Transfer Tax and cigarette/table games/liquor taxes.  This $569.1 million surplus may impact Budget negotiations between the Governor and General Assembly.

State Tax Revenues Continue Upward Trend

Graph-UpThe PA Department of Revenue released figures showing January 2015 General Fund revenue at $2.4 billion, bringing year to date collections $360.4 million over estimate.  Breakdown showing year to date estimates are: Sales Tax $66.6 million more than anticipated; Personal Income Tax $400,000 over estimate; Corporate Tax Revenue $162.6 million more than anticipated; Inheritance Tax revenue $81.5 million more than anticipated; Other General Fund taxes (tobacco, malt beverage, liquor and table games) showed $23 million above estimate.  On the negative side was the Real Estate Transfer Tax which came in $28.4 million below estimates.

Regulatory Update

  • Regulations graphicThe meeting of the DEP Agriculture Advisory Board originally set for August 20 was cancelled. Next meeting is October 15 in Harrisburg. Details:  Tom Juengst 717/783-7577 (tjuengt@pa.gov)
  • On July 26, the Pa. Bulletin published a listing of how much money each county receives for dirt, gravel, and low-volume road maintenance. These amounts were determined by the State Conservation Commission at its May 13 meeting. Amounts ranged from $144,714 (Union County) to $1.478 million (Bradford)  Details: http://www.pabulletin.com/secure/data/vol44/44-30/1610.html

Bleak Budget Forecast

budget paIn April, normally a good month in revenue collections, PA collected $3.4 billion in general revenue which was $328.3 million or 8.8% less than anticipated. YTD collections were $23.9 billion by April 30 or 1.7% below projections. This apparently does not take into account a recent court decision that reinstated PA’s share of Tobacco Settlement money.

There are two outcomes:

First, Governor Corbett is examining existing budgets to see where savings/cuts can be found so as to balance this year’s budget.

Second, June’s budget deliberations mean that some areas where he proposed increases such as in education may be in doubt as the state faces a new fiscal year even gloomier than this one.

Adding to the pain are warnings from those assessing Pennsylvania’s fiscal solvency that continued inaction on resolving the pension crisis means a credit downgrade for the Commonwealth.