Bluefield Daily Telegraph, Bluefield, WV

Virginia State News

July 30, 2012

Va. ends FY ’12 with $129M surplus

RICHMOND, Va. — Virginia’s government finished the 2012 fiscal year last month with about $129 million more in general revenue than what was predicted in the official forecast on which the state budget is based.

Gov. Bob McDonnell plans to discuss the final revenue figures later Monday.

In an Associated Press interview, Finance Secretary Ric Brown said revenues for the 12 months ending June 30 increased by 5.4 percent over the previous fiscal year, ahead of forecast growth of 4.5 percent.

The better-than-expected revenues, however, are only part of the total surplus. The other part, created by savings and account balances swept from state agencies, will be reported on Aug. 15, the day McDonnell addresses the combined House and Senate money committees.

Fiscal year 2012 was the third year in a row for the state’s general fund collections to exceed their budgeted forecasts. The general fund pays for such core state services as public safety, health care and aid to public schools.

Crippled by the worst economic downturn since the Great Depression, state general revenues finished the 2009 fiscal year nearly 9.2 percent below the forecast. That forced the General Assembly, former Gov. Timothy M. Kaine and McDonnell after him to cobble together packages of deep cuts, savings in state operations and emergency reserves from the “rainy day” fund to avoid deficits.

Brown, who was attending a national conference of state budget officers, said finishing ahead of projections in an economy mired in a tepid recovery is gratifying and something few of his counterparts at the meeting can claim.

“Any time you can come in at 5 (percent) or 6 percent growth, I’ll take it,” Brown said, recalling months of uncertainty over the past fiscal year when it appeared the state could end up with a shortfall.

Individual withholding tax, which most people pay on their wages, finished about $33.7 million ahead of expectations. Sales tax collections added $55 million to the surplus, and corporate income taxes were $32 million better than expected.

Nonwithholding income taxes collected on dividends and by the self-employed were down slightly, but the state paid out less in refunds.

 

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