Chris Christie’s Revenue Estimates Off By A Quarter Billion Dollars [AUDIO]
Revenue collection for Fiscal Year (FY) 2012 missed Governor Chris Christie’s targets by more than a quarter-billion dollars according to the non-partisan research arm of the legislature.
The Office of Legislative Services (OLS) has released it revenue snapshot for FY 2012 year-end totals.
The OLS statement explains that most FY 2012 major revenue collections and annual year-end revenue accounting adjustments are now complete. According to current figures from the State’s Comprehensive Financial System (CFS), the 14 major revenues tracked by OLS each month trail the Executive’s May 2012 targets by a combined $253.9 million.
In the aggregate, these major revenues grew by 2.9% over FY 2011. The revenues included in this report account for about 88% of budgeted State revenues and exclude certain energy-related revenues and various miscellaneous sources.
Sales tax receipts total $7.946 billion, $99.1 million below the Christie’s May revised target for FY 2012. OLs says, “This revenue significantly underperformed expectations during the last three months of the fiscal year, recording declining amounts in May and June and low growth in July.” Overall, the sales tax grew by 2.3% in FY 2012.
Gross Income Tax (GIT) cash receipts of $11.109 billion grew by 4.6% over the prior year. This total is $208.7 million above the Christie’s May revised year-end target.
OLS explains, “Most of the additional amount is due to a larger than expected bookkeeping shift of certain partnership withholding receipts from the corporation tax accounts to the GIT.” For FY 2012 this shift was $190.8 million more than in FY 2011.
Corporation Business Tax (CBT) cash collections of $2.027 billion are down 9.0% from FY 2011. Total receipts are $286.8 million below the Executive’s May revised target for FY 2012. OLS says, “While the CBT underperformed expectations, the size of the shortfall in FY 2012 collections is largely a result of the $190.8 million increased bookkeeping shift to the GIT.”
The remaining ten major revenues differed from the Executive’s revised May targets by varying amounts. Combined, these ten revenues fell $83.0 million below their respective targets.
Asked about the OLS report yesterday, Christie said the following as he dripped with sarcasm:
“That’s good news……A month ago they said it would be $542 million.”
“These numbers, when combined with slow economic growth and high unemployment, unfortunately continue a disconcerting trend for New Jersey under Governor Christie,” says Democratic Assembly Budget Committee chairman Vinnie Prieto. “The shortfall means this year’s budget starts with $254 million less than anticipated, requiring even higher growth than was already assumed by Governor Christie to meet his targets for this fiscal year. Unfortunately, we have yet to see any signs of such a so-called comeback, despite the constant spin that budget shortfalls have been tackled.”
Christie has been hammering Democrats for not giving New Jerseyans the guarantee of a tax cut now, but Democrats have steadfastly said they’ll only give the cut in January if it is proven that revenues are hitting Christie’s targets. Prieto says when you look at the current shortfall, “It just shows that we were very prudent to take the road that we did on the tax cut (to) wait until the revenues come out…….Governor Christie needs to finally begin working with us to devise a responsible budget geared towards working class residents. We all support tax cuts, but they must be responsible tax cuts.”
It bears noting that $254 million represents less than eight-tenths of one percent of the entire State budget.
Prieto says, “I plan to convene the Assembly Budget Committee soon for a hearing on this revenue shortfall. Middle-class New Jerseyans already bearing a net 20 percent property tax hike and women who have lost access to quality health care under Governor Christie deserve answers from the administration.”
Later this year, the Comprehensive Annual Financial Report (CAFR) will provide the official audit of State resources, as well as official expenditures for FY 2012. While significant revenue adjustments after September are rare, OLS will update the year-end numbers if additional adjustments occur.