Tax Reform Commission Meeting
The Governor's Tax Reform Commission held its second meeting today. Gov. Abramson opened the meeting by stating that a decision has not yet been made on the hiring of a consultant for the Tax Reform Commission. He added that a decision would be made and the hiring would be announced to Commission members via email sometime before the May meeting of the Commission and that he expected the consultant would be present at that meeting.
Greg Harkenrider began his presentation with a review of similar tax reform efforts since 1983. He described 15 to 20 such efforts, noting that most took place during or soon after times of recession that strained state tax policy and revenues. Among the numerous studies mentioned, Harkenrider singled out the 1995 Blueprint for Comprehensive Tax Reform as a well done review with sound policy recommendations that continue to be pertinent today.
You can download a copy of Harkenrider's presentation HERE.
Monthly Receipts Report Released
The General Fund and Road Fund have experienced solid revenue growth through the first three quarters of Fiscal Year 2012 and the March tax receipts were a large part of that. The March receipts report released yesterday by State Budget Director Mary Lassiter showed that the General Fund revenues grew 8.4% and Road Fund revenues grew 6.1% compared to March 2011.
Three takeaways from the March receipts report:
1. Through three quarters General Fund receipts are exceeding the revenue forecast made by the Consensus Forecasting Group. The CFG had predicted 2.8% growth and actual growth is at 4.3% thus far. However, the fourth quarter of FY 2011 was a very strong period of revenue growth, so receipts will have to be very strong over the next three months to match last year's growth and book additional surplus for FY 2012.
2. Road Fund revenues are up 7.3% year to date and need to increase 0.5% over the next three months to meet the Road Fund revenue forecast of 5.5% growth for FY 2012. The Road Fund is lead by significant growth in motor fuels tax revenue increases.
Download a copy of the press release and March revenue report HERE.