AUGUSTA (AP) – Baldacci administration officials told legislative budget writers Thursday that unanticipated income tax revenue had led to a first-quarter General Fund surplus of $39.2 million for the current fiscal year.
Some of the revenue gain, however, was attributed to timing and is likely to be offset next month, officials said.
Moreover, the revenue gain, which included a plus of $16.9 million in September, coincides with rising indications of budgetary imbalances within the Department of Health and Human Services.
Commissioner John Nicholas told the Appropriations Committee that a fiscal 2005 shortfall projected across the health and human services department currently amounts to more than $37 million.
Nicholas said he hoped to find ways to reduce or eliminate the shortfall without tapping the new Legislature for more money through June 30.
According to Baldacci administration officials, sales tax revenue from July through September exceeded the budget target by $3.2 million, or 1.8 percent.
Individual income tax revenue results were stronger, topping estimates by $23 million, or 10.5 percent, in the first three months of the fiscal year.
Corporate income tax revenue was way up, besting budget through September by $11.2 million, or 52.6 percent.
A third estimated payment for the calendar year was due Sept. 15 for certain corporations, and corporate income tax receipts for the month came in above estimate by $5.5 million.
“Corporate estimated payments were up by 30 percent over last year,” Commissioner Rebecca Wyke of the Department of Administrative and Financial Services said in a statement.
“Many other states and the federal government experienced similar growth in corporate estimated payments in September, indicating that corporate profitability remains strong,” Wyke wrote.
The state’s economic forecasting committee has tentatively developed a new forecast to 2009 that is “is stronger in 2004, but calls for more moderate growth in future years, compared to their February forecast,” Wyke reported.
The committee’s economic forecast will be used by a state government revenue forecasting panel next month in shaping an update of expected state revenue for coming budget cycles.
AP-ES-10-21-04 1602EDT
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