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January 17, 2006


OSC Releases December Cash Report

The Office of the State Comptroller today released the December 2006 cash report

With three quarters of the State’s 2006-07 fiscal year complete, General Fund receipts (including transfers) were $2.3 billion or 6.9 percent ahead of last year.  All Funds receipts were $4.2 billion or 5.5 percent ahead of last year.

General Fund spending (including transfers) was $36.0 billion in the first nine months of the fiscal year.  This is $4.2 billion or 13.2 percent higher than during the first nine months of last fiscal year.  All Funds spending of $80.6 billion was $5.9 billion or 7.9 percent higher than last year.

General Fund disbursements, including transfers, were $511 million or 1.4 percent below plan, while General Fund receipts, including transfers, were $167 million or 0.5 percent below plan.  The General Fund closing cash balance on December 31, 2006, was $2.4 billion, which was $345 million higher than projected by the current 2006-07 Financial Plan, updated October 30, 2006. 

General Fund Receipts and Disbursements

Personal income tax collections prior to transfers to dedicated funds were $2.2 billion or 10.1 percent higher than last year.   This is driven by 13.3 percent year-to-year growth in estimated payments, and 15.7 percent growth in final payments, along with the early payment of an additional $500 million in refunds disbursed prior to the end of the 2005-06 fiscal year. 

Consumption/use tax receipts in the first nine months of the fiscal year fell 4.5 percent, or $293 million, compared to last year.   The major factor in this decline is the elimination of sales tax on clothing priced under $110, which took effect April 1, 2006.  

Business tax receipts rose by $1.0 billion, or 30.0 percent.  The largest growth was in the corporate franchise tax, which rose from $1.8 billion last year to $2.7 billion this year, or 45.0 percent.   Collections in both the bank tax and the insurance tax were also higher this year than last.  Bank tax collections grew from $571 million to $645 million, or 13.0 percent; insurance tax collections rose from $658 million to $754 million, or 14.7 percent.

All Other General Fund taxes rose from $708 million to $916 million, an increase of $208 million or 29.5 percent.  This increase was generated entirely by the estate and gift tax, which rose from $688 million in the first nine months of 2005-06 to $899 million in 2006-07. 

Total General Fund disbursements increased $4.2 billion or 13.2 percent as compared with the first nine months of 2005-06 fiscal year. The growth in General Fund disbursements is driven by increases in education, health,  and social services spending, along with additional payroll disbursements associated with retroactive collective bargaining agreements during this year compared to the same period last year. 

Local Assistance grants increased $2.6 billion over last year, or 13.4 percent. The largest dollar increase was in education spending, which rose from $9.3 billion to $10.2 billion, an increase of $925 million or 10.0 percent.  This growth is due to increased State Aid to Public Schools and reimbursements to City University of New York (CUNY) for collective bargaining agreements.

Spending in the Health and Environment category tripled from $313 million to $941 million, due primarily to the State’s obligation to pay prescription drug costs for New Yorkers who are eligible for both Medicaid and Medicare and who have temporarily lost prescription drug coverage because of complications with the Federal government’s implementation of its Medicare Part D prescription drug program.

Social Services spending increased 11.3 percent, from $7.9 billion to $8.8 billion, due to several factors including the increasing cost of the Medicaid program of providing health care services and prescription drugs, the rising number of recipients of publicly financed health care, and increases in medical service utilization in hospitals, nursing homes, and managed care programs.   Two changes effective January 1, 2006, also contribute to higher spending in 2006-07:  the State began paying 100 percent of the local share of Family Health Plus (FHP), compared to the 75 percent share the State paid during 2005, and the State began capping local Medicaid expenditures.  In calendar year 2006, the State will finance all local costs in excess of 103.5 percent of 2005 expenditures.  The Financial Plan, updated October 30, 2006, estimates the FHP takeover and local cap together will result in increased costs to the State of $476 million in 2006-07. 

Department Operations spending increased 12.7 percent, or $842 million.  General State Charges grew 8.4 percent, or $281 million, while General Fund transfers to other funds rose 19.7 percent, from $2.3 billion to $2.7 billion.  This increase reflects the transfer of $250 million to the Debt Reduction Reserve Fund to finance the defeasance of a like amount of outstanding State-supported debt.

Total Governmental Receipts and Disbursements

Total governmental receipts in the current fiscal year increased $4.2 billion or 5.5 percent from the first nine months of 2005-06.  As described above, personal income tax receipts grew significantly, an increase of $2.2 billion or 10.1 percent over 2005-06. 

Consumption/use taxes decreased slightly: 1.2 percent, or $127 million.  This decrease reflects the exemption of clothing from the State sales tax.  Business taxes increased 23.5 percent or $1.2 billion, largely on the strength of the corporate franchise tax.  All other taxes increased $212 million or 14.4 percent. 

Miscellaneous receipts grew from $11.8 billion to $13.0 billion, an increase of 10.8 percent.  Much of this is from increased bond proceeds and interest earnings, but it is also partly due to the continuing effect of HCRA receipts coming on budget.  Federal receipts decreased slightly, from $25.8 billion to $25.3 billion, or 1.9 percent. 

Total governmental funds disbursements increased $5.9 billion, or 7.9 percent.  Local Assistance grants rose 7.9 percent from $52.6 billion to $56.8 billion.  Of that amount, $676 million was disbursed as checks to homeowners through the STAR Local Property Tax Rebate program.  The State also made payments associated with the June 2006 Southern Tier flooding and the October snowstorm in Erie County. 

Health and Environment spending increased $954 million, from $2.4 billion to $3.4 billion, due partly to the prescription drug obligation mentioned above, but also to the full impact of Health Care Reform Act (HCRA) spending coming on-budget.  Along with the reasons stated above, another factor in the increased Local Assistance spending is the intergovernmental transfers (IGTs) and upper payment limit (UPL) payments that were not made through this time last fiscal year. 

Department Operations rose $770 million, or 6.3 percent, and General State Charges increased $345 million, or 8.9 percent.  Debt Service payments increased $316 million or 12.0 percent, reflecting the $250 million paid out of the Debt Reduction Reserve Fund.  Spending on capital projects increased $323 million, or 9.6 percent.

Click here for a copy of the cash report.

General Fund – Comparison of Financial Plan to Actual Results

(amounts in millions of dollars)

 
Financial Plan Projection
Actual Results
Variance

Cash Balance, April 1, 2006

3,257

3,257

0

 

 

 

 

Taxes

26,203

26,304

101

Miscellaneous and Federal Receipts

1,959

1,671

-288

Transfers from Other Funds

7,070

7,090

20

Total Receipts

35,232

35,065

-167

 

 

 

 

Local Assistance Grants

22,602

22,150

452

Department Operations

7,500

7,475

25

General State Charges

3,603

3,621

-18

Transfers to Other Funds

2,761

2,708

53

Total Disbursements

36,466

35,954

512

 

 

 

 

Cash Balance, December 31, 2006

2,023

2,368

345

General Fund – Comparison of Current Year to Prior Year

(amounts in millions of dollars)

 

 

SFY 2005-06
Through 12/31/05

SFY 2006-07 Through 12/31/06

$ Change

% Change

Gross Personal Income Tax

24,986

26,879

1,894

7.6%

Less Refunds

-3,622

-3,365

256

-7.1%

Collections Before Accounting Transactions

21,364

23,514

2,150

10.1%

Less Transfers to Dedicated Funds

-7,609

-8,909

-1,300

17.1%

Net Reported Personal Income Tax

13,755

14,605

850

6.2%

Consumption/Use Taxes

6,557

6,264

-293

-4.5%

Business Taxes

3,476

4,519

1,044

30.0%

Other Taxes

708

916

208

29.5%

Tax Collections

24,495

26,304

1,809

7.4%

 

 

 

 

 

Miscellaneous and Federal Receipts

1,335

1,671

336

25.1%

Transfers From Other Funds

6,977

7,090

113

1.6%

Total Receipts

32,808

35,065

2,258

6.9%

Local Assistance

19,537

22,150

2,613

13.4%

Department Operations

6,634

7,475

842

12.7%

General State Charges

3,340

3,621

281

8.4%

Transfers To Other Funds

2,263

2,708

445

19.7%

Total Disbursements

31,773

35,955

4,181

13.2%


All Governmental Funds – Comparison of Current Year to Prior Year

(amounts in millions of dollars)

 

SFY 2005-06 Through 12/31/05

SFY 2006-07 Through 12/31/06

$ Change

% Change

Personal Income Tax

$21,364

$23,514

$2,150

10.1%

Consumption/Use Taxes

$10,498

$10,371

-$127

-1.2%

Business Taxes

$4,905

$6,057

$1,152

23.5%

Other Taxes

$1,472

$1,684

$212

14.4%

Miscellaneous Receipts

$11,767

$13,029

$1,262

10.7%

Federal Grants

$25,791

$25,307

-$484

-1.9%

Total Receipts

$75,797

$79,962

$4,165

5.5%

 

 

 

 

 

Local Assistance Grants

$52,616

$56,766

$4,150

7.9%

Department Operations

$12,242

$13,012

$770

6.3%

General State Charges

$3,875

$4,220

$345

8.9%

Debt Service

$2,646

$2,962

$316

12.0%

Capital Projects

$3,365

$3,688

$323

9.6%

Total Disbursements

$74,743

$80,647

$5,904

7.9%

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