by Timothy McQuiston, Vermont Business Magazine Vermont General Fund tax revenues again had a strong month, with July revenues exceeding targets by more than 10 percent, or by nearly $17 million. Corporate returns and the Other category (interest income) were particularly strong and the Personal Income tax continues to surpass expectations.
Interim Secretary of Administration Sarah Clark today released Vermont’s revenue results for July 2024, the first month of Fiscal Year 2025. The General Fund, Transportation Fund and Education Fund exceeded their respective monthly consensus cash flow target as adopted by the Emergency Board at its July 2024 meeting.
The state’s General Fund, Transportation Fund, and Education Fund receipts were a combined $256.1 million, exceeding the $246.8 million monthly consensus target by $9.3 million, or 3.8%.
The Rooms & Meals tax and the Gasoline tax were the most notable of those line items that did not reach their targets. They are also related in part to tourist activity. At this time it is not known if these results are related to the flooding and rainstorms early in the month. In the July 2023 revenue report, those two categories also were lower than expected. Vermont suffered even worse storms and flooding in July 2023 than this year. However, revenues across the board, and cumulatively in all three funds, were mostly below targets in July 2023.
See tables with detail below.
Total General Fund revenues for July 2024 were $171.6 million, although after taking out $9.2 that is attributed to the childcare payroll tax, which was implemented on July 1 and will be reported separately later in the year, General Fund revenues for July totaled $162.4 million, $7.5 million, or 4.8%, above the $154.9 million monthly consensus cash flow target.
For the General Fund, Other includes interest income from the state's cash-on-hand, which is many times higher than pre-COVID years largely because of unspent federal pandemic recovery funds and infrastructure support grants. July FY25 interest earned was $9.3 million on a balance of $1.886 billion (as of close of business 8/22). Meanwhile. FY24 Interest Earned (ending June 30, 2024) was $110.5 million.
A (-$1.8) million combined miss by the Meals and Rooms Tax, Estate Tax and Other Receipts category offset the $9.4 million of combined gains made by all other revenues relative to their respective targets.
Revenues in the Transportation Fund exceeded their $25.7 million July consensus target by $1.4 million, or 5.5%, yielding $27.1 million in total. Only the Gasoline Tax missed its July target by less than (-$0.1) million, or (-1.2%).
Monthly Education Fund revenues of $66.6 million were $0.4 million, or 0.6%, above their July $66.2 million cash flow target. Only the Meals and Rooms Tax missed its July target by just over (-$0.1) million, or (-2.4%).
According to Interim Secretary Clark: “The July revenue results are welcome news as the State begins a new fiscal year. Hopefully these results will continue as Vermont’s economy remains strong, but it is still premature to draw any conclusions. Expectations will be clearer once the first quarter’s results are complete.”
Source: 8.23.2024. Montpelier, VT – Interim Secretary of Administration