FOR RELEASE:

DiNapoli Releases January 2009 Cash Report

State Comptroller Thomas P. DiNapoli today said revenues grew $3.3 billion, or 3.6 percent, through January compared to the same period last year due to growth in federal receipts and personal income tax collections. Personal income tax collections were up, but withholding taxes, the largest portion of personal income tax collections, grew only 0.3 percent through January compared to 6.1 percent growth through January 2008. The Division of the Budget is projecting that withholding collections in the General Fund will decline 2.9 percent for the year. General Fund businesses taxes fell $295.3 million compared to this time last year.

“Revenue growth is slowing dramatically,” DiNapoli said. “This was expected and the state’s financial plan was adjusted, but it still hurts just as much. The federal economic stimulus package will ease some of the pain. But the stimulus package is not a bail out; it’s not a substitute for tough decisions. New York needs to align spending and revenue. Until we fix the structural imbalance in the state budget, New York cannot achieve long-term fiscal stability.”

Other findings in the January Cash Report DiNapoli released today include:

• Personal Income Tax Growth Slowing. General Fund receipts, including transfers, totaled $45.5 billion which was $1.4 billion, or 3.1 percent higher, than last year and $499.6 million over Financial Plan projections, primarily due to growth in personal income tax collections, which totaled $20.6 billion through January compared to $19.2 billion January 2008. DiNapoli cautions that this growth is primarily due to the settlement of the 2007 income tax liabilities and is unlikely to continue. General Fund miscellaneous receipts of $2.1 billion through January are $203 million over the same period last year and $267.8 million over Financial Plan projections.
• Business Taxes Fall Again. General Fund business tax revenues were $3.9 billion through January, or $295.3 million lower than this time last year, and $23 million below Financial Plan projections.
• Other Revenues Slightly Up. All Funds receipts through January grew $3.3 billion, or 3.6 percent, over January 2008 levels.
• General Fund Spending Up. General Fund spending, including transfers, was $42.5 billion ― $2.3 billion or 5.8 percent ― higher than last year, primarily due to increased spending in education and Medicaid. General Fund spending was $212 million over Financial Plan projections released January 15. Spending for State operations in the General Fund was down $1.1 billion because the state shifted spending from other funds.
• All Funds Spending Up. All Governmental Funds spending through January 31 of $96.2 billion was $5.4 billion, or 5.9 percent, more than 2007-08 figures through January 31, 2008, again primarily due to increased spending for Medicaid and education. State operations spending in All Governmental Funds was up $921.7 million or 6.1 percent.

As a result of higher than anticipated revenue collections and lower than projected spending, the General Fund closing balance is $287.5 million over Financial Plan projections.

The state’s finances are generally broken down by two main categories: General Fund and All Funds. The General Fund is the major operating fund of the state and accounts for all receipts that are not required by law to be deposited into another fund. All Governmental Funds includes General, Special Revenue, Debt Service and Capital Projects funds, as well as funds from the federal government.

Click here for a copy of the report.

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