Vermont Business Magazine General Fund revenues were sluggish in August, but personal income taxes came roaring back in September to push GF revenues ahead of targets, as well as above year-to-date expectations and now are well over last year's numbers. September 30 marked the end of the first quarter of fiscal year 2020.
However, the Transportation Fund didn't keep up, which has been a persistent problem in recent years. The fuel taxes and vehicle sales have dragged down total revenues, even as economists have modified estimates. Fuel prices have remained relatively low, as a portion of the gasoline tax is attributed to overall sales. But sales of new cars have also been modest, in part due to the flood of low-mileage used cars coming on the market as leases expire.
The Transportation Fund is below targets for the month and the year-to-date, but ahead of last year's totals.
“General Fund and Education receipts were above the consensus cash flow target for the month, while Transportation Fund revenues were below expectations,” stated Secretary Young. “Year to date, General Fund revenues are above target, and the Transportation and Education Funds are essentially on target.”
General Fund revenues collected for the month totaled $161.73 million, or $7.98 million (5.19%) above the monthly consensus revenue target, which is tied to the annual consensus revenue forecast adopted by the Emergency Board on July 29, 2019. Year-to-date, the General Fund is +$10.57 million, or +2.88%, above its target.
“It is encouraging that the September collections were ahead of forecast because September collections reflect quarterly estimated personal and corporate income tax payments. But we also recognize that we are only one quarter into the fiscal year, and much can change.”
The Transportation Fund collected $25.59 million for the month, -$1.15 million (-4.32%) below its target. Year-to-date, the Transportation Fund is -$0.04 million (-0.06%) below its target – or effectively on target. The Education Fund collected $47.49 million for the month, or $0.55 million (+1.18%) above its target. Year-to-date, the Education Fund is $0.45 million, (+0.32%) above its target – also effectively on target.
Note: Adjusting for redirection of certain health care-related taxes under Act 6 of 2019, for comparison purposes only, in the accompanying General Fund tables, the year-to-date revenues for September 2019 (FY 2020) represent changes of +2.57%, +5.33%, and +8.03% for the General Fund, Transportation Fund, and Education Fund, respectively, from the same period in FY 2019.
