Special Session Spotlight: How Latest Appropriations Compare with June Revenue Collections

June 21, 2024

2024 Third Special Session Fiscal Impacts

During Wednesday’s Special Session, the legislature considered five bills and two resolutions. Only two of those bills or resolutions had direct, measurable fiscal impacts to the state:

  • H.B. 3002 – This bill had a positive, ongoing impact to the General Fund of $157,500 from repealing unused appropriations to the Legislature for federalism efforts. This bill also reallocated $10.1 million from nonlapsing balances of various line items and agencies and placed it into the Federal Overreach Restricted Account (account). From that account, the bill then appropriated $5.3 million to the Department of Natural Resources and the Attorney General for purposes allowable under the account’s authorizing statute. The estimated amount remaining in the account for FY 2025 is just under $4.8 million.
  • H.B. 3004 – This bill had a positive ongoing impact to the General Fund of $6,200 due to reducing per diem expenditures from repealing the Project Entity Oversight Committee.

June Revenue Reports

These positive fiscal impacts, however small, were welcomed by the relatively stagnant revenue growth observed in the latest revenue reports. Last week, the Tax Commission published collections through June 7th. The Revenue Summary Report shows Individual Income Tax down $250.3 million or 4.1% less year-over-year (YoY). On the other hand, State Sales and Use Tax is up $89.0 million or 2.2% YoY. Still, as shown in the June Revenue Snapshot, total collections from all sources to the Income Tax and General Funds are within a percentage point of the consensus forecast. As discussed last month, the legislature built into the current budget a $150 million buffer, which is about three times larger than the current deviation between collections and forecasted revenues.

Economists suggest that the final quarterly payment for corporate income tax, currently up 4.4% over FY 2023, could prove to be a source of volatility as the fiscal year comes to a close. On the bright side, vehicle registration fees are continuing their upward trend, contributing an additional $31.2 million to the Transportation Fund when compared to last year at this time.

It’s worth remembering that this month’s report reflect sales and wages that took place in April and were collected in May. As always, July’s report will preview the FY 2024 yearend, while the final report will be published in October after close out.

The reports referenced in this post are available at the following links: 
June Revenue Snapshot (FY 24)
Tax Commission Revenue Summary (Period 11, FY 2024)
Revenue Publications Archive