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Sunday, 13 January 2013

January 13--  State Senator Jack Hill of Reidsville has some encouraging economic news in his "Notes From The Senate" report.

"ST. NICK" DELIVERS-JUST IN THE "NICK" OF TIME!

December's growth over 2011 of $150.6 million or 9.8% on revenues of $1.68 billion was timely-very timely.

 

After five months of mostly dreary revenue reports and the scary negative report in November, Santa left a December Revenue Report under the tree that was just what the state needed.  Even though press reports had related a sluggish Christmas buying season, December Revenues (which only reflect November Sales Taxes) may have benefitted from the miserable month the state suffered a year ago in December, 2011.

 

Now if that will hold true for January as well (revenues were off in Jan. 2011) then maybe this 2013 budget can be salvaged and some of the economic activity will begin to pay dividends in state revenue increases.

 

Of course, last year, after the first quarter of FY2012 grew at a 7.2% rate, everyone (economists and would-be economists) thought the state was bursting through the clouds of recovery.  Unfortunately the next three quarters averaged less than 5% and the state barely made budget.  After five months of FY013, the growth rate had slipped to 3.7%.  So this encouraging December report does two things: 1. Gives us hope that January will also be positive and start a positive trend and 2. Raises the YTD revenue growth to 4.9%.

 

INDIVIDUAL INCOME TAXES LEAD THE WAY IN DECEMBER

For the first time in a while, Individual Income Tax collections topped 11% (11.8) and produced almost $100 million in revenue.  Estimated Payments were up 19.1% or $17.2 million but the big jump was in Individual Withholding payments showing a huge increase of $97 million or 13.1%.  Individual Refunds were also up $15.7 million, but the overall increase of the category was a healthy 11.8%.

 

State Sales Taxes grossed $440.6 million with an increase of $38.6 million or 4.6%.  Overall Sales Taxes showed only a 3.9% increase.

 

Motor Fuel Taxes were up a combined 4.6% in both Excise and Sales Tax categories at 7.1% and 2.7% respectively, for an overall increase of $3.5 million on revenues of $81.4 million.

 

Corporate Tax collections were up another $10.2 million at $302.1 million.

 

YEAR TO DATE NUMBERS INCH UPWARD

After six months of  Fiscal Year 2013, state revenues stand at $8.6 billion with a gain of $400.0 million and a cumulative increase of 4.9%.  That one positive month of December helped most every category and brings the state closer to making budget.

 

Individual Income Taxes show $4.6 billion with an increase of $237.3 million or a respectable 5.4% YTD.

 

Year to Date (YTD) Sales Tax Collections overall are lethargic, at 1.2% increase or $58.5 million increase on overall collections of $2.6 billion.  The state portion actually increased to $70.3 million or a 2.7% increase.  Adjustments/refunds decreased during the period by -$39.1 million compared to -$71.2 million a year ago.

 

Motor Fuel Taxes are slightly down for the year at -2.5% or minus $12.7 million.  Excise Taxes are slightly up at 0.2% but Motor Fuel Sales Taxes are down -4.5%.

 

Corporate Income continue to be positive after six months, at $302.1 million total, a $78.8 million gain so far or 35.3%.  

 

Tobacco taxes are down for the year by -2.6% and Alcoholic Beverages is up slightly at 0.8%.

 

Total revenue collected for the state so far in FY013 exceeds $8.6 billion with six months to go.    

So as the Legislature assembles for the 2013 Session, December will be seen either as a month that the FY 2013 year turned positive or simply a good month in the middle of a bad year.   Let's pull for the former!

 

CONCLUSION ON JOBS-FROM LAST WEEK

Most metro areas will see employment growth between 1% and 2% with only Columbus slightly higher.  Manufacturing jobs are increasing and expected to grow from the 6000 jobs created in 2012.  Similar increases of 1.4% to 1.5% are seen for the next 18 months in transportation, warehousing and utilities.  Professional and business services outlook is good while education and health will continue solid growth.   

 

 

 
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