On Friday (November 15) the state’s Economic and Revenue Forecast Council (ERFC) issued its monthly report on general fund revenue collections. The report is available here.

Revenues for the most recent month were $66.0 million greater than the forecasted amount. However, this “positive variance” was wholly due to transfers of unclaimed property to the general fund. These transfers were $108.0 million greater than forecasted, while revenue from all other sources was $42.0 million less than forecasted.

This report covers payments received between October 11 and November 10 for the sales tax, the use tax, the business and occupation tax, the public utility tax, the tobacco products tax, and penalties and interest (collectively the Revenue Act receipts), while it covers payments received between October 1 and October 31 for liquor taxes, cigarette tax, property tax, real estate excise tax, unclaimed property and other sources.

This report primarily includes payments relating to September activity for monthly filers and to July, August and September activity for quarterly filers.

The total amount received this month was $2,543.6 million, $66.0 million (2.7%) more than the amount expected under the forecast that ERFC adopted at its September 26th meeting. In last month’s report, revenues exceeded forecast by $68.1 million. Thus, for the two months combined, collections are $134.1 million more than the amount forecasted.

For the month, Revenue Act taxes (primarily the sales, use, utility, and business and occupation taxes) fell $9.5million (0.5%) short of forecast. For two months, however, Revenue Act collections were ahead of forecast by $29.0 million. Retail sales tax collections were down 1.7% year over year, while B&O tax collections were down 1.1%.

For the month, Non-Revenue Act revenues exceeded the forecast by $75.1 million. Unclaimed property, which was $108.0 million greater than forecasted, fully accounts for this positive variance. A single business accounted for $84 million of the unclaimed property transferred to the state in October. This amount is unusually large. ERFC staff suspect that the payment amount was an error and that most of these funds will be refunded before year end.

Finally, transfers from the court system to the general fund exceeded forecast by $0.5 million for the month.

The chart below compares year-over-year growth rates of general fund-state revenues to year-over-year inflation in the consumer price index:

This is the first time since March and April of 2022 that year-over-year revenue growth exceeded year-over-year inflation in consecutive months.

The ERFC will meet at 2:00 tomorrow afternoon to adopt a new forecast of state revenues. With the good news in the last two collections reports, it’s likely that the forecast will be increased.
The agenda for the meeting and a video link are available here.