Just a little over a year after state voters approved a three-year, $437 million transfer of funds to shore up the state’s troubled General Fund, state officials said Tuesday the budget finished the fiscal year with a tiny surplus.
Acting Finance Director Bill Newton said the General Fund, which pays for most non-education programs in the state had a surplus of about $3 million on Monday, the final day of the 2013 fiscal year.
The leftover money represents just two-tenths of a percent of the $1.76 billion spent by the fund in the fiscal year, which ended Monday. However, the transfer of money from the Alabama Trust Fund helped the state avoid proration, and potentially devastating cuts to services like Medicaid and Human Resources.
The budget gets its revenues from about three dozen sources, most which show little year-to-year growth. The General Fund collected about $1.72 billion during the 2013 fiscal year; the General Fund began the year with $42 million leftover from the 2012 budget.
In the hopes of spurring greater growth in General Fund revenues, legislators last year voted to transfer 25 percent of the state’s use taxes and 75 percent of future Internet sales taxes into the General Fund. However, Alabama and other states are currently banned from collecting Internet sales taxes; proposals to authorize it have stalled in Congress.
The state’s Education Trust Fund, funded mainly by income and sales taxes, collected $5.68 billion in fiscal year 2013, with expenses of $5.44 billion. Gov. Robert Bentley’s office announced Friday that the $260.2 million surplus would go toward paying a Rainy Day Account, as required by law.
Newton said individual income tax receipts grew 6.1 percent over the 2012 fiscal year, due to the strong economy; however, sales tax grew only 0.2 percent year-to-year.
“We are researching to get an answer for that question,” Newton said. “We think there are a number of factors into that.”
Newton said his office was “still comfortable” with projections of year-over-year growth in the state’s budgets.
– posted by Brian Lyman