The early, preliminary estimate of a $13 million shortfall in December’s state tax revenues has now shrunk to $12.6 million, according to Gov. Butch Otter’s budget chief, Wayne Hammon. “That’s why we don’t release it, because it always changes,” he said. Yesterday, under questioning by the Joint Finance-Appropriations Committee, Hammon revealed the “incomplete preliminary” estimate that showed another shortfall in December. “It’s still likely to change,” he noted.
The biggest part of the $12.6 million shortfall was an $11.5 million drop from projected levels for individual income tax, and oddly, it was mostly in higher than expected refunds. December isn’t typically a big month for income tax refunds; the figure may reflect people who filed last spring and then amended their returns. Sales taxes, however, were very close to on-target, falling short for the month by just $100,000, Hammon said. “That’s really good,” he said, and it comes in a key month for sales tax revenues “So the bad news is we’re 12.6 million off. The good news is the two ongoing factors, sales tax and withholding, are right on target. So it validates (Mike) Ferguson’s belief that we’ve hit the bottom.”
The $12.6 million is still a preliminary estimate, not yet “scrubbed,” Hammon said. That means analysts haven’t finished going back through the numbers to see if any reflect one-time anomalies or other factors that should affect how they’re interpreted. Hammon predicted, “It’ll change, but it won’t change by a whole lot.”