DiNapoli: State Revenue Remains Below Projections
Total revenue collections for the State of New York continued to fall short of projections, according to the August cash report State Comptroller Thomas P. DiNapoli released today. Total General Fund tax revenue of $13.8 billion was $238 million below updated projections, and year-to-date General Fund personal income tax collections remain $114 million lower than the updated projections through August.
“Tough choices on spending could have been made during the spring budget process,” DiNapoli said. “Avoiding those choices has made the state’s fiscal condition even more challenging. September’s collections are typically more indicative of economic conditions, but last month’s results clearly indicate that we are not out of the woods yet. Current cash flow projections show very little room for additional revenue shortfalls and every month that ends with a greater than anticipated shortfall only makes things worse down the road.”
The Division of the Budget (DOB) updated the State’s 2009-10 Financial Plan on July 30 to reflect first quarter results in revenue collections and spending as well as economic conditions. DOB lowered projections for total General Fund receipts for the year by approximately $2 billion. The August cash report measures current revenue and spending numbers against this updated financial plan.
Specific report findings include:
- General Fund receipts, including transfers from other funds, through August 2009 of $18.6 billion were $444.5 million below Financial Plan projections and nearly $5 billion lower than last year for the same period. The year-to-year variance is primarily due to lower personal income tax collections in the beginning of the fiscal year.
- Total General Fund tax collections through August 31 of nearly $13.8 billion were down $3.7 billion, or 21.3 percent, from last year and $237.6 million below projections for the first five months. Year-to-date General Fund personal income tax collections were $8.8 billion, $113.8 million below projections.
- Year-to-date General Fund consumption tax collections of $3.2 billion were nearly $280 million below collections from the same period last year and $53.2 million below projections. Within this tax category, sales tax collections within the General Fund are $300 million, or 9.4 percent, lower than last year.
- Year-to-date General Fund business tax collections of $1.4 billion were $204.9 million higher than collections for the same period last year, but $57.6 million below projections. General Fund miscellaneous receipts of $680 million were $102 million below collections from last year, and $75.4 million lower than projected primarily due to the receipt of reimbursements used to offset certain General Fund costs.
- General Fund spending, including transfers to other funds, of $19.8 billion was $2.1 billion, or 9.6 percent, less than last year through August 31. The decline in spending was mostly due to costs for general state charges (down $797.5 million primarily due to the timing of payments) and Medicaid (down $1.4 billion – reflecting federal stimulus Medicaid payments made from other funds). These declines were offset by increases in education spending (up $703.7 million) and other health and environment spending (up $330.9 million). In total, General Fund spending was $293.2 million below projections.
- All Governmental Funds receipts through August 31 of $46 billion were $469.2 million below projections and $291.6 million lower than last year for the same period. Total tax collections of nearly $20.9 billion were down $4.6 billion, or 18.2 percent, from last year and $281 million below projections. Federal receipts increased by nearly $3 billion from last year, which was $12.3 million lower than projected. Miscellaneous receipts through August 31 of $7.9 billion were $1.4 billion higher than collections for the same period in SFY 2008-09, primarily due to the receipt of bond proceeds from public authorities, but $175.9 million lower than projections.
- All Governmental Funds spending through August 31 of $46.1 billion was $1.4 billion, or 3.1 percent, more than last year for the same period, primarily due to increases in Medicaid spending ($1.9 billion or 14.2 percent), and education ($1.1 billion or 12.1 percent). These increases were offset by lower spending for general state charges ($894.9 million), transportation grants ($400.3 million), non-personal service spending ($302.7 million) and other social services spending (down $251.2 million). All Funds spending was $631.3 million below projections.
The state’s finances are generally broken down by two main categories: General Fund and All Governmental 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. DiNapoli’s monthly cash report compares state finances against the same time period last year and the state’s current year Financial Plan.
Click here for a copy of the report.