Press Release from the Department of Finance & Administration, March 9, 2010:
Nashville – State revenue collections once again fell short of budgeted estimates last month. Overall February revenues were $638.9 million, which is $47.1 million less than the state budgeted.
“This entire fiscal year has brought us negative growth in the sales tax, which is almost two-thirds of our revenue,” Finance and Administration Commissioner Dave Goetz said. “Moreover, the running total is now 21 consecutive months of negative growth in sales tax collections since January 2008, when the downward economic spiral began for us in Tennessee.”
“In spite of the budgetary challenges, we have laid out a plan for balancing the budget and we’re working with the Legislature to end this year and the next with a balanced budget, as our constitution requires.”
On an accrual basis, February is the seventh month in the 2009-2010 fiscal year.
The general fund was under collected by $43.8 million and the four other funds were under collected by $3.3 million.
Sales tax collections were $38.4 million less than the estimate for February. The February growth rate was negative 6.67%. The year-to-date growth rate for seven months is negative 5.84%.
Franchise and excise taxes combined were $1.4 million above the budgeted estimate of $33.0 million. For seven months revenues are over collected by $7.4 million. The year-to-date growth rate for seven months is 8.32%.
Gasoline and motor fuel collections for February decreased by 3.86%, but were $180,000 above the budgeted estimate of $68.3 million. For seven months revenues are under collected by $13.9 million.
Tobacco tax collections were $4.0 million under the budgeted estimate of $23.1 million. For seven months revenues are over collected in the amount of $303,000.
Year-to-date collections for seven months were $232.4 million less than the budgeted estimate. The general fund was under collected by $196.3 million and the four other funds were under collected by $36.1 million.
The budgeted revenue estimates for 2009-2010 are based on the State Funding Board’s consensus recommendation adopted by the first session of the 106th General Assembly in May of 2009, and are available on the state’s Web site.
The State Funding Board met again on December 18, 2009 and adopted revised revenue ranges for 2009-2010. The revised ranges reflect growth rates ranging from negative 1.50% to negative 0.25% in total taxes, and negative 2.35% to negative 0.85% in general fund taxes.
Based on the funding board’s consensus recommendation, the official budgeted estimates for 2009-2010 were revised in late December. The revised estimates are reflected on pages A-70 and A-72 in the 2010-2011 Budget Document. The revised estimates assume an under collection in total taxes in the amount of $161.3 million, and an under collection of $153.2 million in the general fund.