Capitol - Your Illinois News Radar » State revenue down $1.135 billion, but there were a few bright-ish spots
SUBSCRIBE to Capitol Fax      Advertise Here      Mobile Version     Exclusive Subscriber Content     Updated Posts    Contact
To subscribe to Capitol Fax, click here.
State revenue down $1.135 billion, but there were a few bright-ish spots

Tuesday, Jul 7, 2020

* Hannah Meisel at the Daily Line

Illinois’ general funds revenue was off by $1.135 billion at the end of FY 2020 as compared with FY 2019, according to the Commission on Government Forecasting and Accountability’s monthly report published last week. The total drop was close to what COGFA and the Governor’s Office of Management and Budget had predicted for the state when Illinois’ revenue estimates were adjusted due to the state’s screeching halt in economic activity due to Covid-19, but slightly exceeded expectations. Moving Illinois’ deadline for income taxes from the traditional April 15 to July 15 to match the federal tax delay accounted for some but not all of the $765 million net drop-off in personal income tax revenue for FY 2020. Gross corporate income taxes dropped $308 million net, sales taxes were off by $154 million net from last year’s levels, according to COGFA. In the next six months, Illinois will borrow up to $5 billion from the Federal Reserve to make up for lost revenues through a first-of-its-kind program set up by the Fed this spring and borrowing authorized by the General Assembly in the budget approved during the legislature’s four-day special session in May.

* June wasn’t as horrible as some might’ve though, according to COGFA

Only a few revenue sources experienced increases for the month. As indicated above, gross personal income taxes fared well, rising $173 million, or $150 million net. Again, it is assumed that some final payments [which usually would have fallen in April] have instead been spread over May/June and will extend into July to coincide with the revised deadline. Public utility taxes increased $12 million in June, while other sources grew $12 million and inheritance tax receipts $7 million.

Despite the overall monthly gain, most revenue sources suffered declines in the last month of the fiscal year. Gross sales taxes fell $83 million, or $74 million net. Gross corporate income taxes were down $48 million, or $33 million net. Insurance taxes continued a very volatile pattern of receipting by dropping $44 million. Cigarette taxes were down $19 million for the month, corporate franchise taxes were off $10 million, and interest income dipped $3 million.
Overall transfers grew $26 million for June. Other miscellaneous transfers posted a $60 million gain, but was partially offset by a $9 million decline in lottery transfers and $25 million loss in riverboat transfers [as casino and video gaming was temporarily halted until July 1st]. As mentioned earlier, federal sources had a strong month, rising $184 million. That gain was made possible due to proceeds from June’s short-term borrowing being directed to reimbursable Medicaid spending.

* FY 20 year end

The “Big Three” revenue sources felt the brunt of COVID-19. For the fiscal year, gross personal income taxes fell $947 million, or $765 million net. Gross corporate income taxes dropped $430 million, or $308 million net, while gross sales taxes were off $206 million, or $154 million net from last year’s levels. In total, the combined net drop of the “Big Three” was $1.227 billion.

Most of the other revenue sources experienced a down year as well, with all other revenue sources dropping a net $255 million.
Aided by gains associated to Refund Fund and Capital Projects Fund transfers, overall transfers to the general funds managed to grow $396 million. That gain was significantly muted by COVID’s impact on the lottery as well as riverboat gaming activities. Federal sources, despite ending the year with a flourish, experienced wide monthly swings in performance this fiscal year and finished down $49 million.

* Finke

Benjamin Varner, a senior analyst and economic specialist for COGFA, said the Illinois and national economies have shown signs of improvement, but the danger is not over.

“Although the improving economy may have seen a trough and begun to expand again, it does not mean that the economy is in a good place or could not tumble further,” he said. “The economy remains well below its peak. It will need continued strong growth to return to previous levels.”

That outlook was seconded by Comptroller Susana Mendoza in a recent interview with Capitol News Illinois. She told the news service that managing the current state budget may be even more challenging than dealing with the budget impasse because the state must now deal with the effects of less revenue.

Illinois lawmakers approved a budget for the current fiscal year that avoided steep cuts to state programs. Instead, it relies on the state borrowing up to $5 billon from the Federal Reserve in order to keep state government operating. It is relying on further assistance from the federal government to ensure the budget is balanced.

* Related…

* Record reefer revenue for state coffers in June - State collects almost $12M from taxes for recreational cannabis, topping total for April

- Posted by Rich Miller        

  1. - Huh? - Tuesday, Jul 7, 20 @ 10:26 am:

    Billion here, billion there. Soon we’ll be playing with real money.

  2. - Dotnonymous - Tuesday, Jul 7, 20 @ 10:42 am:

    I just saw the State Trooper selling shrooms article from Greenville…Strange days indeed!

  3. - essentially working - Tuesday, Jul 7, 20 @ 10:47 am:

    Aaaahhhh, I finally understand why pot retail was allowed to operate as “essential” even for non-medical users. Risk-reward…

  4. - RNUG - Tuesday, Jul 7, 20 @ 1:21 pm:

    Someone yesterday asked what did I know they didn’t when I suggested the flat income tax could go to 7%, and why would the State need to raise $7B - $8B?

    $5B federal borrowing + $1B reduced revenue = $6B shortfall.

    Add in increased pension and school payments in the coming years, and $8B increase may not be enough.

TrackBack URI

Sorry, comments for this post are now closed.

* Caption contest!
* Question of the day
* First, get a handle on this virus
* ILGOP's attempt to have its gatherings treated the same as religious services met with skepticism by federal appellate court
* 1,645 new cases, 16 additional deaths, 4.1 percent positivity rate
* ISBE survey: Most students will be learning remotely this fall
* Mask rule roundup
* Tie-breaker rules adopted, allowing approval of 75 new cannabis dispensary licenses
* Deep in the weeds with Tom DeVore
* SUBSCRIBERS ONLY - Supplement to today's edition
* MLB open thread
* SUBSCRIBERS ONLY - Today's edition of Capitol Fax (use all CAPS in password)
* Illinois AKA sorority sisters respond to Kamala Harris' choice as Biden's running mate
* Yesterday's stories

Visit our advertisers...





Main Menu
Pundit rankings
Subscriber Content
Blagojevich Trial
Updated Posts

August 2020
July 2020
June 2020
May 2020
April 2020
March 2020
February 2020
January 2020
December 2019
November 2019
October 2019
September 2019
August 2019
July 2019
June 2019
May 2019
April 2019
March 2019
February 2019
January 2019
December 2018
November 2018
October 2018
September 2018
August 2018
July 2018
June 2018
May 2018
April 2018
March 2018
February 2018
January 2018
December 2017
November 2017
October 2017
September 2017
August 2017
July 2017
June 2017
May 2017
April 2017
March 2017
February 2017
January 2017
December 2016
November 2016
October 2016
September 2016
August 2016
July 2016
June 2016
May 2016
April 2016
March 2016
February 2016
January 2016
December 2015
November 2015
October 2015
September 2015
August 2015
July 2015
June 2015
May 2015
April 2015
March 2015
February 2015
January 2015
December 2014
November 2014
October 2014
September 2014
August 2014
July 2014
June 2014
May 2014
April 2014
March 2014
February 2014
January 2014
December 2013
November 2013
October 2013
September 2013
August 2013
July 2013
June 2013
May 2013
April 2013
March 2013
February 2013
January 2013
December 2012
November 2012
October 2012
September 2012
August 2012
July 2012
June 2012
May 2012
April 2012
March 2012
February 2012
January 2012
December 2011
November 2011
October 2011
September 2011
August 2011
July 2011
June 2011
May 2011
April 2011
March 2011
February 2011
January 2011
December 2010
November 2010
October 2010
September 2010
August 2010
July 2010
June 2010
May 2010
April 2010
March 2010
February 2010
January 2010
December 2009
November 2009
October 2009
September 2009
August 2009
July 2009
June 2009
May 2009
April 2009
March 2009
February 2009
January 2009
December 2008
November 2008
October 2008
September 2008
August 2008
July 2008
June 2008
May 2008
April 2008
March 2008
February 2008
January 2008
December 2007
November 2007
October 2007
September 2007
August 2007
July 2007
June 2007
May 2007
April 2007
March 2007
February 2007
January 2007
December 2006
November 2006
October 2006
September 2006
August 2006
July 2006
June 2006
May 2006
April 2006
March 2006
February 2006
January 2006
December 2005
April 2005
March 2005
February 2005
January 2005
December 2004
November 2004
October 2004

Blog*Spot Archives
November 2005
October 2005
September 2005
August 2005
July 2005
June 2005
May 2005


RSS Feed 2.0
Comments RSS 2.0

Hosted by MCS SUBSCRIBE to Capitol Fax Advertise Here Mobile Version Contact Rich Miller