Receipts to General Fund down 8.3 percent

State Budget Director Mary Lassiter and Gov. Steve Beshear

By John Cheves – jcheves@herald-leader.com

Receipts to Kentucky’s General Fund dropped 8.3 percent in December 2009 compared to December 2008, State Budget Director Mary Lassiter said Friday. Total revenue for last month was $787 million, compared to $858 million for the same month a year earlier, Lassiter said.

Receipts are now down 4.6 percent for the first half of fiscal year 2010, she said. Projections call for a 2.7 percent revenue decline for the year. To meet that forecast, revenue can decline only 0.8 percent over the last six months of the fiscal year.

“December’s negative revenue report is a stark reminder that recessionary economic times continue to prevail,” Lassiter said in a statement.

This week, Gov. Steve Beshear announced that he would plug a $108 million budget shortfall for the remainder of this fiscal year, which ends June 30, with a combination of 3 percent spending cuts in some state agencies, transfers from other funds and the use of one-time federal stimulus money.

Sales and use taxes are down 5.6 percent for the year so far, corporate income taxes are down 36.6 percent for the year and individual income taxes are down 7.7 percent for the year, Lassiter said.

However, property taxes are up 5.2 percent for the year, and cigarette taxes are up 74.7 percent for the year, reflecting a rate increase Kentucky imposed on tobacco products in April 2009.

Apart from the General Fund, which pays for most of state government’s operations, the Road Fund, which pays for most road projects, collected $86.4 million in December 2009, a 3.9 percent increase over the same month a year earlier.

Lassiter said the Road Fund is starting to improve after two years of declines, in part because of rising tax collections on fuels.