Nebraska tax revenue falls below projections in July; refunds to businesses a factorBy AP
Tuesday, August 10, 2010
Nebraska tax revenue misses mark in July
LINCOLN, Neb. — Nebraska tax revenue tumbled below projections in July, missing the mark by 9.6 percent mainly because of tax breaks to companies that qualify for programs meant to create jobs.
The report released Tuesday by the Revenue Department said gross tax receipts were 3 percent below the forecasts that form the baseline for the state budget.
Income from sales and individual income taxes were below projections, while corporate income-tax receipts surpassed expectations.
But $19 million in refunds to corporations under the state’s business-incentive programs sharply undercut net corporate-income receipts. The figure included accumulated refunds from previous years.
Without the large refund figure, overall net revenues would have roughly been on par with projections.
Gov. Dave Heineman said Nebraska doesn’t need a special legislative session to address the budget because the state does not have cash flow problems.
Heineman added later that he is “still nervous” about the state’s fiscal picture.
The state budget has a built-in cushion equal to at least 3 percent of planned spending — much like a minimum balance many people try to keep in their checking accounts — to help weather lower-than-expected revenues.
State Sen. Lavon Heidemann of Elk Creek, chairman of the Legislature’s budget-writing Appropriations Committee, agreed with Heineman that a special session wasn’t needed.
Lawmakers held a special session in November where they closed a $334 million budget gap, largely using across-the-board cuts to state agencies. That special session was held not long after lawmakers had approved a two-year budget that was not lean enough to withstand stagnant state revenues.
When lawmakers gather in January during the regular session, they will craft a new, two-year budget that might require them to close a budget gap of several hundred million dollars.
Revenue report: www.revenue.ne.gov/research/gen_fund/nr0810.html
Tags: Lincoln, Nebraska, North America, United States