State revenues down 10 percent in September
State Economist Dr. Phil Pepper told the Joint Legislative Budget Committee a week ago today that the long-term revenue outlook for the state was not very good.
The short-term forecast looks positively dreadful.
September tax collection numbers surfaced today, and they aren’t pretty. Overall, the state brought in $404.9 million last month, 10 percent under revenue estimates officials made only three months ago. The total shortfall for the month was just short of $45 million.
August offered a sliver of hope that the trend of monthly revenue shortages could be coming to an end. Gov. Haley Barbour said then the Cash for Clunkers program probably had a lot to do with August revenue falling only about 2 percent short of estimates.
September’s sales tax figures were $13.6 million, or almost 9 percent, under estimates, bolstering Barbour’s argument that Cash for Clunkers artificially inflated August sales tax collections. Individual income tax collections in September were almost 14 percent, or $22.7 million, short of what the Revenue Estimating Group, of which Pepper is a member, thought they would be.
Barbour has already made cuts to the fiscal year 2010 budget, slashing $172 million from K-12 education spending on Sept. 3. Barbour, who is in the middle of a two and a half week economic development trip to Asia, has said since then that more cuts are almost a guarantee. For the first quarter of FY10, revenue is already $77 million (more than 7.5 percent) shy of expectations. Judging from September’s revenue, trimming the budget will be at the top of Barbour’s to-do list when he returns home.