JEFFERSON CITY – Tax revenue flowing into Missouri’s coffers in the first quarter of the fiscal year fell short of what lawmakers and Gov. Jay Nixon had hoped for when building this year’s budget blueprint.
In a report released Tuesday, Acting State Budget Director Dan Haug announced that 2016 fiscal year-to-date net general revenue collections increased 3.6 percent compared to 2015.
The $27 billion spending plan approved last spring was initially based on tax revenue rising by 4.1 percent. That has since been adjusted to 5.5 percent.
Haug said the first quarter growth rate is not a concern because data show the state’s economy is strong.
“We’re doing okay. We expect faster growth in the second half of the fiscal year,” Haug said.
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The lower-than-anticipated overall growth rate means it is unlikely that Gov. Jay Nixon will release the nearly $175 million in spending he has frozen since the start of the fiscal year on July 1.
Citing a combination of unexpected tax breaks approved by the Republican-led Legislature and the slower pace of tax revenue, Nixon said he would not allocate money for dozens of programs, including a $20 million fund for road and bridge projects, a $3.5 million increase for the state’s Public Defender Commission and a variety of agricultural programs.
He could selectively release money for some of the programs if tax revenues grow faster than expected.
“We’re always monitoring that,” Haug said.
The lead budget negotiator in the Missouri House was less than enthusiastic about the possibility. Rather, Rep. Scott Fitzpatrick, R-Shell Knob, who will chair the House Appropriations Committee next spring, said he thinks the governor may have to cut more from the existing budget.
“In my opinion, there probably will have to be more withholds,” Fitzpatrick said Tuesday.
While income and sales tax collections continue to rise over last year’s totals, corporate income and franchise taxes continue to struggle. The report shows corporate income decreased nearly 22 percent for the year after falling over 16 percent in August.