Tax collections were disastrous

The September revenue numbers are disastrous for the state budget.

Kansas collected nearly $45 million, or 7.9 percent, less in tax revenue last month than estimated.

As a result, the state will either have to make midyear budget cuts or rob more money from other funds. Or both.

And Senate President Susan Wagle, R-Wichita, is correct: If Gov. Sam Brownback is going to cut funding to state agencies or universities, he shouldn’t wait until the Legislature returns in January. The sooner he gets started, the better.

Tax collections were off in all three major categories: Individual income tax receipts were $14.2 million less than the estimates, corporate taxes were down by $17.5 million, and sales taxes were short by $9.4 million.

Missing the revenue targets wasn’t unusual. The state has missed every monthly estimate so far this fiscal year, and 11 of the past 13 months. And since Brownback’s tax cuts took effect in January 2013, tax collections have fallen short of expectations 32 of 45 months.

It’s gotten so bad that it’s surprising when tax collections meet the predictions.

Still, the size of this shortfall was more than many expected.

The combined shortfalls for July and August were about $23 million.

The state projected to have only $5.6 million in reserves by the end of this fiscal year if it met its revenue estimates. Counting the September shortfall, the state budget is now more than $60 million in the hole only three months into this fiscal year.

And, of course, it is likely the missed estimates will continue – at least until November, when the state will likely lower its projections again.

Revenue Secretary Nick Jordan blamed regional economic trends and stock market declines for most of the September shortfall. But it is unclear why the revenue forecasters have so badly missed the estimates.

Some of the answers may come Tuesday, when Brownback officials discuss proposals for improving the accuracy of the estimates. Wichitan Sam Williams headed up a review of the estimating process.

The big question is whether the review will cast any fault on Brownback’s tax policies.

But that’s even less likely to happen than the state meeting its October revenue estimate.

This story was originally published October 4, 2016 at 5:04 AM with the headline "Tax collections were disastrous."