State Government Finances - March 2008
State Government Finances
According to data from the Alabama Department of Revenue, total tax collections in Alabama in February 2008 were up 2.9 percent compared with a year earlier (on a three-month moving average basis). This trend is a continuation of lackluster growth during most of 2007 and is in contrast to the robust growth between 2003 and 2006. Most major revenue categories have decelerated. Alabama government officials and legislators are expected to discuss budget cuts as well as additional draws from the Educational Trust Fund to fund schools for the remainder of the current fiscal year.
According to data from the Florida Department of Revenue, total tax collections in Florida during February 2008 declined 10.8 percent from a year earlier (on a three-month moving average basis). The Florida legislature, which got under way in March, has spent much of its time dealing with declining revenue and measures to downsize the budget. Legislators approved reducing the size of the current year budget by another $512 million in March after reducing it by $1 billion in late 2007. Legislators are expected to cut an estimated $2.5 billion from the 2008–2009 proposed spending plan. The governor stated that reserves may be used to shore up the budget. Some legislative leaders support shrinking the size of government while others have called for investing in roads and other public works projects to stimulate the state's economy.
According to data from the Georgia Department of Revenue, total tax collections in Georgia remained weak during February 2008. Revenue collections were down 3.0 percent in February compared with a year earlier (on a three-month moving average basis). Weakness appeared to be broad based. In response to weak February numbers, Governor Perdue reduced the spending estimate for the current fiscal year and has targeted cuts of $65 million. He also recommended cutting next year's budget estimate by $245 million. Included in his recommendation is a reduction in spending across state agencies.
According to data from the Louisiana Department of Revenue, total tax collections in Louisiana increased 1.5 percent in December 2007 from a year earlier (on a three-month moving average basis), with sales tax collections declining 4 percent. The modest growth in total revenue is weaker than experienced on average since Hurricanes Katrina and Rita hit the state in the fall of 2005.
According to data from the Mississippi State Tax Commission, total tax revenue in Mississippi increased 5.6 percent in February 2008 from a year earlier (on a three-month moving average basis). Mississippi's tax revenues have grown by an average of approximately 5 percent per year since 2004.
According to data from the Tennessee Department of Revenue, total tax collections for February 2008 were up 0.8 percent compared with the same period last year (on a three-month moving average basis). Over the past few months, revenue growth has slowed appreciably and is below target. More state spending cuts could be under way for Tennessee if collections continue to underperform.