Across the nation, states are finally seeing some relief to their bottom lines. Robust tax collections have resulted in an overall increase of 9 percent from 2012, according to the recent State Revenue Report.
Only two states, Kansas and Mississippi, bucked the trend. Personal income tax collections were down by 3.3 percent in Kansas, and 1.3 percent in Mississippi.
Twenty-four states recorded double-digit increases.
States generally rely on a relatively balanced three-legged stool for funding: personal, sales and property taxes.
After the Great Recession of 2007, retail sales plummeted by 10 percent and stayed depressed until 2010. They have yet to come back completely. As of September 2013, retail sales were only 2.6 percent above pre-recession levels.
Property tax receipts started to trend upward almost immediately, but stalled in 2010, where they, too, remain.
And corporate income tax receipts remain 17.5 percent below from when the bottom fell out in 2007.
For those with new-found money, the wants still exceed the means. Many are planning to shore up depleted stocks or long-ignored programs
States favoring significant increases to education are Republican-leaning states Alaska, Georgia, Idaho, Indiana, South Carolina and South Dakota. “Blue” states include West Virginia, Washington, Rhode Island and New York.
Our neighbor, Missouri’s Jay Nixon, a Democrat, has proposed a $270 million increase to public school funding while calling on four-year institutions for a freeze on tuition.
Kansas’ Gov. Brownback, meanwhile, is pushing the legislature to implement all-day kindergarten at the tune of $16 million a year.
Other governors are channeling funds to pay down debts and neglected programs. Alaska’s Sean Parnell has proposed to reduce the state’s pension deficit. Those wanting to address road and bridge maintenance are Delaware, Rhode Island and South Carolina.
The governors of Hawaii, Maryland and Washington wish to use their excess to raise the minimum wage.
KANSAS has pretty much cut itself out of the discussion. With its reduction of the personal income tax, the state is on track to have a zero balance by 2016, according to the Kansas Legislative Research Department.
If he were to win re-election, Gov. Brownback’s budget plan would have the state with a negative bank balance of $921 million by the end of fiscal year 2019.
Clearly, more cuts are on the horizon.
Our peers are planning for the future with enhanced schools, roads, technology and wages.
Kansas is not.
— Susan Lynn