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TN January Tax Collections Exceed Budgeted Expectations

Press release from the Tennessee Department of Finance & Administration; February 13, 2015:

NASHVILLE, Tenn. – Tennessee’s total tax collections exceeded budgeted expectations in January, driven by strong holiday consumer spending and unexpected one-time collections in corporate taxes.  Finance and Administration Commissioner Larry Martin today announced that overall January revenues were $1.3 billion, which is $219.5 million more than the state budgeted.

“January sales tax collections, reflecting consumer spending that occurred during December, posted the largest monthly growth rate we’ve experienced for the past 33 months, and we recorded our strongest second quarter growth since 2006,” Martin said. “We believe this month’s growth was heavily influenced by several factors, including aggressive holiday retail marketing, continued reduction in the unemployment rate, lower gasoline prices, and an overall improving economy.

“It’s important to note that all corporate payments, including one-time payments, are received throughout the year based on estimates, and reconciled at a later point with their final corporate filings.  Although good news, one-time payments, when identified, are separated from our recurring tax base and used only to support one-time expenditures and uses. As always, the state will keep the budget in balance by working closely with the legislature.”

On an accrual basis, January is the sixth month in the 2014-2015 fiscal year.

The general fund was over collected by $214.1 million and the four other funds were over collected by $5.4 million.

Sales tax collections were $34.2 million more than the estimate for January.  The January growth rate was positive 7.80%. For six months revenues are over collected by $132.4 million. The year-to-date growth rate for six months was positive 6.76%.

Franchise and excise taxes combined were $171.4 million more than the budgeted estimate of $151.9 million. For six months revenues are over collected by $158.0 million.

Gasoline and motor fuel collections for January increased by 10.68% and were $2.4 million above the budgeted estimate of $71.3 million.  For six months revenues are over collected by $10.7 million.

Motor Vehicle Registration Tax collections were $3.0 million more than the budgeted estimate for January and the growth rate was positive 5.56%.

Tobacco tax collections were $2.7 million more than the budgeted estimate of $18.1 million, and for six months they are $2.6 million under the budgeted estimate.

Inheritance and estate taxes were over collected by $4.5 million for the month. Year-to-date      collections for six months are $13.9 million more than the budgeted estimate.

Privilege tax collections were $1.9 million less than the January estimate, and on a year-to-date basis, August through January, collections are $5.1 million above the estimate.

Business tax collections were $0.7 million more than the January estimate. For six months revenues are $13.8 million more than the budgeted estimate.

All other taxes were over collected by a net of $2.5 million.

Year-to-date collections for six months were $343.9 million more than the budgeted estimate. The general fund was over collected by $323.4 million and the four other funds were over collected by $20.5 million.

The budgeted revenue estimates for 2014-2015 are based on the State Funding Board’s consensus recommendation of December 17th, 2013 and adopted by the second session of the 108th General Assembly in April 2014. They are available on the state’s website at http://www.tn.gov/finance/bud/Revenues.shtml.

The Funding Board met on December 11, 2014 to hear updated revenue projections from the state’s various economists. The board met again on December 16 and adopted revised revenue ranges for 2014-2015. The revised ranges assume an over collection from the July 2014 budgeted estimate in the amount of $32.3 million to $73.4 million in total taxes. The revised ranges for the general fund recognize a negative growth in the amount of $6.6 million up to a positive growth of $27.5 million for the current fiscal year.

COLLECTION TABLES

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May Revenue Collection Continues Upward Growth Trend

Press release from the Tennessee Department of Finance & Administration; June 11, 2013:

NASHVILLE, Tenn. – Tennessee revenue collections continued an upward growth trend in May with a net positive growth of 3.92% over collections made in the same month last year. Finance and Administration Commissioner Larry Martin reported today that overall May revenues were $905.3 million or $31.5 million more than the state budgeted. It’s the tenth consecutive month this fiscal year in which total collections have reflected positive growth.

“The sales tax growth rate rebounded in May compared to earlier months, mainly because of building materials sales and purchases of new automobiles,” Martin said. “Corporate tax collections continued to show strong growth, exceeding budgeted expectations.

“Tennessee’s sales tax collections suggest that we are continuing to slowly recover from the worst recession on record. Slow recovery coupled with national and global economic concerns call for us to closely monitor collections and expenditures for the remainder of the year.”

On an accrual basis, May is the tenth month in the 2012-2013 fiscal year.

The general fund was over collected by $35.3 million, and the four other funds were under collected by $3.8 million.

Sales tax collections were $11.2 million more than the budgeted estimate for May. The May growth rate was positive 3.97%. For ten months revenues are under collected by $27.7 million. The year-to-date growth rate for ten months was positive 1.72%.

Franchise and excise taxes combined were $8.8 million above the budgeted estimate of $45.3 million. For ten months revenues are $276.6 million over the budgeted estimate.

Inheritance and estate tax collections were $17.0 million above the May estimate. For ten months collections are $27.5 million above the budgeted estimate.

Privilege tax collections were $3.5 million more the May budgeted estimate, and for ten months collections are $29.2 million above the budgeted estimate.

Gasoline and motor fuel collections for May decreased by 7.26%, and were $3.9 million less than the budgeted estimate. For ten months revenues are negative 2.63%, and $18.5 million below the budgeted estimate of $702.5 million.

Business tax collections were $2.0 million less than the May estimate and year to date for ten months collections are $0.2 million above the budgeted estimate.

Tobacco tax collections were $1.7 million below the budgeted estimate of $23.0 million. For ten months revenues are under collected in the amount of $8.6 million.

All other taxes for May were under collected by a net of $1.4 million.

Year-to-date collections for ten months were $319.6 million more than the budgeted estimate. The general fund was over collected by $319.7 million and the four other funds were under collected by $0.1 million. The FY 2013 revised budget assumed an over collection of $305.9 million in General Fund Taxes. Therefore, the amount of over collection, August through May, compared to what’s in the revised FY 2013 budget is $13.8 million ($319.7 million minus $305.9 million).

The budgeted revenue estimates for 2012-2013 are based on the State Funding Board’s consensus recommendation of December 19th, 2011 and adopted by the second session of the 107th General Assembly in April 2012. They are available on the state’s website at http://www.tn.gov/finance/bud/budget.html.

The State Funding Board met on December 14, 2012 to hear updated revenue projections from the state’s various economists. The board met again on December 19th and adopted revised revenue ranges for 2012-2013. The revised ranges assume an over collection from the July 2012 budgeted estimate in the amount of $203.0 million to $287.3 million in total taxes and in the amount of $224.2 million to $305.9 million in general fund taxes for the current fiscal year.

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Larry Martin Announced Interim Finance Commissioner

Press release from the Office of Tennessee Gov. Bill Haslam; May 28, 2013:

NASHVILLE – Tennessee Gov. Bill Haslam today announced Larry Martin will become the interim commissioner of the state Department of Finance and Administration (F&A) when Commissioner Mark Emkes retires at the end of the month.

Martin becomes interim commissioner at F&A June 1 after Emkes’ retires effective May 31.

A year ago, he joined the governor’s staff as a special assistant to the governor, working alongside Human Resources Commissioner Rebecca Hunter to oversee the implementation of Haslam’s civil service reform, the Tennessee Excellence, Accountability and Management (TEAM) Act; and reviewing state employee compensation.

“I am grateful that Larry has agreed to step into this position and serve Tennessee taxpayers in this capacity,” Haslam said. “He has been critically important in helping us establish the systems and organizational structure to begin recruiting, attracting and retaining the best and brightest to serve in state government, and I look forward to continuing to work with him as interim commissioner of F&A.”

From September 2006 to December 2011, Martin, 65, served as deputy to the mayor in Knoxville for both Haslam and Mayor Daniel Brown. He was responsible for Finance, Public Works, Community Development, Information Systems, Purchasing and Risk Management for the City of Knoxville.

Prior to joining city government, Martin was an executive of First Horizon/First Tennessee Bank, joining the company in 1969 and serving in various capacities before retiring as the chief operating officer for First Tennessee Financial Services with responsibility for all Tennessee Regional Bank Markets; Merchant Services Processing; Hickory Venture Capital; and the Commercial, Corporate, and Middle Market Divisions of the bank. A native of Jackson, Tenn., Martin received his bachelor of science from the University of Tennessee’s College of Business.

“Under Gov. Haslam, Tennessee has taken incredible steps toward making state government more responsive to its customers, the taxpayers, and I want to thank him for this new opportunity to serve the state,” Martin said.

The search for a permanent replacement is ongoing.

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April Continues 9-Month Positive Growth Trend for TN Revenue Collections

Press release from the Department of Finance & Administration; May 9, 2013:

NASHVILLE, Tenn. – Tennessee revenue collections continued their positive growth trend in April with a net growth of 9.31% over April collections one year ago. Finance and Administration Commissioner Mark Emkes reported today that overall April revenues were $1.5 billion or $160.9 million more than the state budgeted.

Total collections in April marked the ninth consecutive positive growth month this fiscal year. Corporate Franchise and Excise taxes and collections from the Hall Income Tax contributed substantially to the large over collection in April. Sales tax collections, however, recorded the second negative growth month this year.

“We expect one very large Franchise and Excise tax month remaining in this fiscal year, but with sales tax collections performing below budgeted expectations, we need to closely watch our revenue and expenditure patterns,” Emkes said. “National economists are warning states not to get overly confident during peaks of the slow recovery, so we are going to continue conservative budgeting to maintain stable financial conditions.”

On an accrual basis, April is the ninth month in the 2012-2013 fiscal year.

The general fund was over collected by $142.8 million, and the four other funds were over collected by $18.1 million.

Sales tax collections were $5.8 million less than the budgeted estimate for April. The April growth rate was negative 0.70%. For nine months revenues are under collected by $38.9 million. The year-to-date growth rate for nine months was positive 1.48%.

Franchise and excise taxes combined were $111.3 million above the budgeted estimate of $360.8 million. For nine months revenues are $267.8 million over the budgeted estimate. The year-to-date growth rate August through April was positive 13.42%.

Hall Income tax collections for April were $46.6 million more than the budgeted estimate. For nine months collections are $49.3 million above the budgeted estimate. The growth rate for the nine month period was positive 46.29%.

Inheritance and estate tax collections were $2.3 million below the April estimate. For nine months collections are $10.5 million above the budgeted estimate.

Privilege tax collections were $7.9 million more than the April budgeted estimate, and for nine months collections are $25.7 million above the budgeted estimate. The year-to-date growth rate for the nine month period was 15.67%.

Gasoline and motor fuel collections for April increased by 6.69%, and were $0.6 million more than the budgeted estimate. The growth rate for nine months was negative 0.49%, and collections are $14.6 million below the budgeted estimate of $631.0 million.

Tobacco tax collections were $3.8 million over the budgeted estimate of $22.3 million. For nine months revenues are under collected in the amount of $6.9 million.

All other taxes for April were under collected by a net of $1.2 million.

Year-to-date collections for nine months were $288.1 million more than the budgeted estimate. The general fund was over collected by $284.4 million and the four other funds were over collected by $3.9 million. The FY 2013 revised budget assumed an over collection of $305.9 million in General Fund Taxes. Therefore, the amount of under collection, August through April, compared to what’s in the revised FY 2013 budget is $21.5 million ($284.4 million minus $305.9 million).

The budgeted revenue estimates for 2012-2013 are based on the State Funding Board’s consensus recommendation of December 19th, 2011 and adopted by the second session of the 107th General Assembly in April 2012. They are available on the state’s website at http://www.tn.gov/finance/bud/budget.html.

The State Funding Board met on December 14, 2012 to hear updated revenue projections from the state’s various economists. The board met again on December 19th and adopted revised revenue ranges for 2012-2013. The revised ranges assume an over collection from the July 2012 budgeted estimate in the amount of $203.0 million to $287.3 million in total taxes and in the amount of $224.2 million to $305.9 million in general fund taxes for the current fiscal year.