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State revenue dips in April, raising possibility of budget shortfall

May 10, 2013 | | Comments 0

By Beth Musgrave
bmusgrave@herald-leader.com

FRANKFORT — State revenue declined 2 percent in April, highlighting the possibility of a budget shortfall in the final two months of the fiscal year.

Kentucky’s General Fund collections were down $16.5 million from April 2011, according to figures released Friday.

The state’s two-year budget calls for revenue growth of 2.4 percent this fiscal year, but meeting that target would require 3.6 percent revenue growth in May and June. If that doesn’t happen, the state will have to find additional money or make cuts to balance its books.

A recent revenue forecast conducted by the Office of State Budget Director predicted revenue growth of 2.1 percent for the fiscal year that ends June 30, said State Budget Director Jane Driskell.

Large declines in the sales tax, corporate income taxes and property tax collections hampered April’s revenue numbers, Driskell said.

“Continued weakness in the sales tax is particularly conspicuous since the national economy is improving and consumer confidence is growing,” she said.

Sales taxes fell 7.3 percent from the previous April. Corporate income tax collections fell 89.7 percent in April but have increased 2.8 percent year-to-date.

The state’s Road Fund, which relies primarily on gas and other transportation taxes, had one of its best months to date. Revenues were up 18 percent in April compared to April 2011. The state collected $143.1 million for the Road Fund in April, the most ever collected in a single month.

Filed Under: KY General AssemblyState BudgetState Government

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