Colorado’s tax collections were higher than expected in September, continuing an overall trend of growth in tax collections for the year.
Still, with the state’s general fund having fallen from $7.5 billion in the 2008-09 fiscal year to what will be less than $6.9 billion in the current 2010-11 fiscal year, state revenues would need to grow handsomely to restore the general fund and keep up with the rising costs and increased social-services caseloads under the state’s current level of spending.
“It’s always good news when revenues are coming in ahead of forecast, but we need to keep it in perspective,” said Todd Saliman, budget director for Gov. Bill Ritter. “The economy is improving, but the improvement is modest.”
Legislative analysts predicted in September that the state could face a $1.1 billion shortfall in the budget year that begins in July 2011. In the current budget year, the state is facing an estimated $257 million shortfall, which could be offset some if revenues continue to come in higher than expected.
Ritter’s office is expected to release a budget rebalancing plan for the current year at the end of this month. His 2011-12 budget will be presented to lawmakers Nov. 1.
The state has weathered the recession the past two years largely through one-time solutions such as tapping cash funds and relying on federal stimulus money, though there also have been significant cuts to schools and colleges and cost savings such as furloughs and no raises for state workers.
Tax collections for September show that gross general-fund collections were $68.5 million — or 10.5 percent — higher than forecast. Meanwhile, individual income-tax collections came in at $433.4 million, 11.8 percent higher than forecast.
Net corporate income-tax collections were 23.4 percent higher than forecast, coming in at $88.9 million.
Total year-to-date collections were 5.3 percent higher than collections through September a year earlier and 4.2 percent higher than forecast.
Saliman cautioned, though, that things could turn south again when the state releases its next revenue forecast in December.
“This is only September,” he said. “We need to plan prudently and hope that this is an indication of things to come.”
Tim Hoover: 303-954-1626 or thoover@denverpost.com
