Strong economy continues to boost state revenues

The good news: it occurred without a tax increase. The bad news: the government gets to spend the money.

(B'ham News) MONTGOMERY - State tax collections continued their strong growth in the first 11 months of the government's budget year, according to state Finance Department reports released Tuesday.

Tax collections and other revenue for Alabama's Education Trust Fund, which supports public schools and colleges, totaled $4.96 billion from Oct. 1 through Aug. 31, an increase of $462.9 million, or 10.29 percent, compared to the same period a year earlier.

The state General Fund grew at an even faster rate, 12.5 percent, than the larger Education Trust Fund. ...

The trust fund gets about 87 percent of its money from state income-tax and sales-tax collections.

Personal and corporate state income tax collections totaled $2.83 billion from Oct. 1 through Aug. 31, an increase of $290.7 million, or 11.5 percent, compared to the same period a year earlier.

State sales tax collections for the trust fund totaled $1.48 billion from Oct. 1 through Aug. 31, an increase of $106.0 million, or 7.7 percent, compared to the same period a year earlier.

The fast growth in the trust fund so far this budget year continues a trend from last year. The Education Trust Fund in the year that ended last Sept. 30 grew by 11.5 percent compared to the previous year.

That growth, and the 10.29 percent growth for the first 11 months of this fiscal year, both are well above the trust fund's long-term average growth of about 5 percent. ...

The state General Fund, which supports Medicaid, prisons and other non-education programs, grew by an even faster rate.

Tax collections, interest payments and other revenue for the General Fund totaled $1.45 billion from Oct. 1 through Aug. 31, an increase of $160.9 million, or 12.5 percent, compared to the same period a year earlier. ...

Interest payments on state deposits totaled $187.2 million from Oct. 1 through Aug. 31, an increase of $60.6 million, or 47.9 percent, compared to the same period a year earlier.

Oil and gas production taxes raised $131.2 million from Oct. 1 through Aug. 31, an increase of $34.6 million, or 35.8 percent, compared to the same period a year earlier. ...

The General Fund also enjoyed strong growth in the previous budget year, growing by 9.5 percent in the year that ended Sept. 30, compared to the previous year.