State Tax Receipts Rebound

You may have missed this Bloomberg report yesterday:

“The two-year slide in tax collections that opened a $196 billion gap in U.S. state budgets has stopped, easing pressure on credit ratings and giving leeway to lawmakers as they craft spending plans for next year.

The 15 largest states by population forecast a 3.9 percent gain in tax revenue in fiscal 2011, budget documents show. The 50 states on average may increase collections by about 3.5 percent, the first time in two years the figure is expected to grow, said Mark Zandi, chief economist at Moody’s Economy.com,

California took in 3.9 percent more since December than projected in January, Controller John Chiang said this month. New York got $129 million above forecasts in its budget year through February, according to a report from Comptroller Thomas DiNapoli. In New Jersey, the second-wealthiest state per capita, January sales-tax collections were 1.9 percent higher than a year earlier, the first annual increase in 19 months, forecasters said in a report last month.”

This is yet another sign of a gradual, modest recovery taking hold:

Revenue Decline Leveling Off:
15 Largest States by Population

State          FY 08     FY 09     FY 10     FY 11*    Change
               Revenue   Revenue   Revenue   Revenue   FY 10-11

California     $103.0    $82.8     $88.1     $89.3      +1 %
Texas(1)         41.4     37.9      37.3      40.4      +8 %
New York (2)     60.9     60.3      58.8      62.2      +6 %
Florida          24.1     21.0      21.0      22.4      +6 %
Illinois(3)      24.8     22.6      21.6      21.4      -1 %
Pennsylvania(3)  27.9     25.3      27        26.2      -3 %
Ohio             22.1     20.9      19.0      19.1      +1 %
Michigan(4)      20.9     18.3      17.4      17.8      +6 %
Georgia          17.7     15.8      14.7      15.4      +5 %
North Carolina   19.6     17.4      17.3      20.6(5)   +6 %
New Jersey       32.6     28.9      27.7      28.3      +2 %
Virginia         15.6     14.3      13.9      14.4      +3 %
Washington       15.7     14.1      13.8      15.0      +8 %
Arizona           8.8      7.7       7.0       7.3      +4 %
Massachusetts    23.2     20.6      21.3      22.0      +3 %

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Source:
Tax Receipts Rebound as 15 Biggest States See Gain
Dunstan McNichol
Bloomberg, March 30 2010
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aKBVswcpwXBE