State tax revenue exceeds forecast
- October 11, 2011 - 7:12 AM
State budget officials got some good financial news Monday from a report showing tax collections beat projections for the first three months of the new fiscal year.
But economists warned that the nation's economy is growing slower than projected, signaling that state leaders might soon be heading for another budget deficit.
The state took in $3.6 billion in revenue from July through September, about $59 million more than projected.
Individual, corporate and sales tax collections were nearly $140 million more than projected, according to the state.
The state logged an $80 million shortfall from other sources of revenue, but economists said that was largely the result of the timing of a final income tax reciprocity payment from Wisconsin. Budget officials figured a $59 million payment from Wisconsin would come later this year, but it came early enough to be included in last year's fiscal ledger.
ISH Global Insight, the state's economic consultant, warned that the nation's economy hasn't improved much during the summer. Global Insight has slightly downgraded its prediction for how much the economy will grow in 2012, now forecasting 1.4 percent growth, down from an earlier estimate of 1.8 percent.
State budget officials said Minnesota's labor market has performed better than the national average. Through August, its employment rate was down 3.2 percent from December 2007 levels. Nationally, employment rolls have sunk by 4.9 percent in the same period.
Since the recession ended in June 2009, Minnesota's employment rolls have edged up 1.3 percent, more than double the national average.
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