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CHARLESTON -- With the first three months of fiscal year 2021 done, state officials said state tax collections broke several records.
According to the Department of Revenue, tax collections for the month of September came in at $423.6 million, giving the state a $10 million surplus over estimated revenue of $413.6 million. September tax collections also exceeded tax collections for September 2019 by 4 percent.
"I couldn't be more pleased," Gov. Jim Justice said Thursday. "This is great news, West Virginia. What a day."
September marks the first quarter of fiscal year 2021 that began July 1. Tax collections for July, August, and September combined were $1.240 billion, giving the state a surplus of $90.4 million year-to-date over the estimated collections of $1.149 billion. That also puts the state 12.8 percent ahead of collections for the first quarter of the previous fiscal year.
Justice and Department of Revenue Secretary Dave Hardy, speaking during a special briefing Thursday to talk about the revenue numbers, said the state has a cash flow of $297.8 million compared to the same time period last year when the state had a $120.1 million cash flow. The $297.8 million is the best cash flow the state has seen since 2009.
The state also broke records for first quarter tax revenue collections for personal income tax and the consumer sales and use tax. September personal income tax collections were down slightly, coming in at $194 million, which was 1 percent below estimate.
However, year-to-date personal income tax collections were $614 million, or $22.4 million above estimates. First quarter revenues were 22 percent better than the first quarter for last fiscal year.
Consumer sales and use tax collections came in at $129.3 million for September, which was just slightly above estimate for the month. But year-to-date consumer sales tax collections were $350.8 million, which was $15.2 million above estimates and 6 percent better than the same time period last year. Revenue from the personal income tax and consumer sales tax make up nearly 75 percent of tax revenue for the General Revenue Fund.
"Just imagine a state that is going through the COVID situation that is a cannonball to any state's stomach," Justice said. "We're reporting to you that we have an all-time record sales tax collection for the first quarter, and an all-time record personal income tax collection for the first quarter."
Revenue from the corporate net income tax also came in higher than estimates. September collections were $105.8 million, which was $43.3 million more than the estimate of $62.5 million and 110 percent better than the prior year's collections at this same point.
One area that continues to lag is coal and natural gas severance tax collections. September severance tax collections of $18.6 million was $5.8 million below estimates. Year-to-date collections of $22.6 million were only up by $5.8 million over estimates.
"While we are very hopeful that we can have more and more mining jobs and more and more gas opportunities from the standpoint of building our pipelines or downstream petrochemical stuff … as severance being the very thing that propelled this state forward in the past, it was the only thing we had," Justice said. "Now we have moved more and more to a diversified economy."
Hardy said the state has received glowing remarks from bond rating agencies, including Moody's and Fitch reaffirming the state's bond ratings. Hardy said Standard and Poor's recently gave the state high marks for budgetary performance that anticipates fiscal pressures, good financial management policies, and a governmental framework to allows for expenditure and revenue adjustments as necessary.
"This is Standard and Poor's making these compliments about how West Virginia's financial picture looks and how we as a team, under the leadership of the governor, are managing the state's finances," Hardy said. "We couldn't be happier in the Department of Revenue about the state's finances today."
(Adams can be contacted at sadams@newsandsentinel.com)