The Register-Herald, Beckley, West Virginia

Local News

July 3, 2014

W.Va. ends fiscal year with more than $27 million surplus

The last month of the fiscal year proved to be the best for West Virginia, with a revenue surplus more than $27 million above estimates.

Secretary of the Department of Revenue Bob Kiss said the surplus is in part due to a statewide hiring freeze, which has been extended indefinitely.

Deputy Secretary Mark Muchow reported $19.3 million in collections, a figure 25 percent above the prior year’s receipts. Tax collection for the year topped $4 billion, which is down $3 million from 2012, when tax revenues peaked, Muchow said.   

The surplus will be good news for legislators who will have an estimated surplus of $13 million in general revenues and another $30 million in surplus lottery funds to work with next year, Kiss said.

“We’re entering another challenging fiscal year, so there will be a need for that money,” he said.

Muchow said FY14 is the second year of decline in general revenues.

“We can’t have another year like the last two, otherwise we’re in trouble,” he said.

Trends show a decrease in tobacco purchases in the state, as well as a decline in gaming revenues.

Severance taxes showed the best performance for the month at $81.5 million. Coal severance tax continues to fall, while natural gas continues to rise. Part of the increase had to do with timing since the taxes were due June 15 instead of June 30. But Muchow said the 210 percent increase over last year’s revenues were all due to natural gas.

Corporate income tax revenues lagged at $7.3 million below estimates and $26.3 million below estimate for the year.

Business and Occupation Tax, generally a good revenue source for the state’s coffers, was just $1.1 million above estimates and 5.5 percent below last year’s receipts.

Muchow said that the closing of coal-fired power plants will eventually detract from B&O tax revenues; utility and natural gas receipts were higher because of the extra long, cold winter.

June’s numbers also show an increase in personal income and sales tax collection, a good bellwether for a better FY15, Kiss said.

— E-mail: ppritt@register-herald.com

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