CONCORD — State revenues were $48 million more than projections for the 2013 fiscal year ending June 30. But that is $2 million less than needed for the current budget to balance over the next two years.
House and Senate budget negotiators believed the revenue surplus would be $2 million more. They counted that money in balancing the 2014-2015 biennial budget they project to have a $44,000 surplus.
Without the money, the 2014 fiscal year budget which began July 1 has a $2 million deficit.
At the end of a fiscal year state financial officials determine what the state is stilled owed in taxes for that year, but will be paid in the new current fiscal year.
The figures are preliminary and will not be finalized until an audit is completed in several months.
Making those adjustments increased unrestricted revenues by $5 million, business taxes by $2.5 million, the tobacco tax by $1.7 million, the real estate transfer tax by $1.1 million and all other adjustments by $1.8 million. The adjustments reduced the communications tax by $2.8 million and liquor revenues by $1 million.
Business taxes produced $36 million more than projected for the year, which is a 7 percent increase over estimates and a 7 percent increase over last year's returns.
However that additional revenue was offset by two tax cuts approved by the last Legislature, a 10–cent reduction in the tobacco tax and prohibiting the state from collecting the communications tax for Internet access.
The Internet access prohibition reduced the communications tax revenues by $25.2 million or 30.6 percent from estimates and the tobacco tax cut reduced those revenues by $13.1 million or 6 percent.
Because the tobacco tax produced less money than projected in both the 20102 and 2013 fiscal years, the tax will increase 10 cents to $1.78 a pack Aug. 1. Budget writers project the increase will produce about $25 million in additional revenue over then next two years.
Medicaid Enhancement Tax revenues were also significantly below projections for the year, down 27 percent or $28.5 million. The levy is on hospitals net patient receipts and has been significantly below budget writers' projections for the past two years due to a dispute over state reimbursements for the hospital's charity care.
The insurance tax on premiums, real estate transfer tax, board and care revenues from nursing homes and the utility property tax all produced significantly more revenue than budget writers projected. 2013 revenues included two one-time settlements — tobacco and the gasoline additive MtBE — totalling $30 million.
Revenue from traditional taxes was 2 percent above estimates while total revenues, including the settlements and other one-time events, were up 2.7 percent.
Revenues are only half the state's financial picture. State financial officials continue to work to adjust state spending as well in order to determine what the state's surplus will be for the 2013 fiscal year.