State of Kansas misses revenue estimates by $1.7 million in March

Kansas missed revenue estimates by $1.7 million in March, according to the Kansas Department of Revenue.

That won’t help the state close its budget gap, but it doesn’t significantly widen it either.

March numbers

The state exceeded estimates for sales tax by $5.9 million, or 3.3 percent, and for the insurance premiums tax by $6.7 million, or 44 percent, in March. It fell short on individual income tax revenue, which came in at $14.4 million, or 9 percent below estimates.

For the fiscal year

The state missed estimates by more than $50 million in February, prompting the governor to cut spending for higher education by 3 percent. After March, the state is about $81 million below revenue estimates for the current fiscal year, which ends in June, and faces a budget hole of about $30 million.

What does it mean?

“After a weak month in February, withholding rebounded in March but not quite as strongly as anticipated,” Revenue Secretary Nick Jordan said in a statement.

“While corporate income, sales and use tax receipts are up, oil severance payments are down,” Jordan said. “It is a trend that is contributing to a sluggish economy in many rural counties which depend heavily on oil and commodities.” Oil and gas severance taxes were $2.3 million, or 50.9 percent below estimates for the month.”

What’s next:　

There are three months left in the current fiscal year. Policymakers will have to take action before the year ends to ensure the state remains solvent.

House Minority Leader Tom Burroughs, D-Kansas City, said he had “grave concerns regarding the overall shortfall for the year.”

“More will have to be done when the Legislature reconvenes in late April to balance the budget and chart a new, fiscally responsible and sustainable path forward,” Burroughs said.

The state’s economists will revise revenue estimates on April 20. If they lower estimates, the state could face a bigger hole for both the current and next fiscal year.

This story was originally published April 1, 2016 at 4:05 PM with the headline "State of Kansas misses revenue estimates by $1.7 million in March."