Good news, bad news on state budget
July 4, 2003
There was good news and bad news as Mississippi's new fiscal year began last Tuesday. The good news is that sales tax collections for June, the final month of the fiscal year, were 7 percent higher than what lawmakers projected when the budget was completed in the spring of 2002; individual income tax collections were 20 percent higher and corporate tax collection were up by 3.4 percent.
The bad news is that Mississippi collected $117.8 million less than projected in taxes for the full fiscal year.
Revenue estimates, as candidates for governor have already said, are like moving targets, sometimes moving so much as to be virtually meaningless. Still, the state's budgeteers took the June collections as a positive sign.
Mississippi collected $3.3 billion in revenue for the just-ended fiscal year 2003. The original estimate was $3.4 billion. Overall, revenues were 2.3 percent higher than the previous fiscal year. For June, tax collections were $33.3 million above estimates.
Sales and income taxes account for more than 60 percent of general fund revenues so we guess anytime these categories are close to projections it's a good thing.
Still, Mississippi government continues to operate on an archaic system of revenue estimating that forces members of the Legislature to vote on programs that need dollars that do not exist when the votes are taken. For example, the budget for the fiscal year ended June 30, 2003, was actually conceived in the spring of 2002.
In the future, perhaps we in the media need to do a better job of explaining to the public that springtime revenues debated so intensely by lawmakers are really just hopes, not reality. Reality sets in later.