May 2019 Monthly Briefing
ECONOMY: HAVE EXPECTATIONS CHANGED?
Benjamin L. Varner, Senior Analyst and Economic Specialist
In the December 2018 monthly briefing, the Commission observed economic expectations entering the new year by examining the forecasts provided by A Digest of Economic Forecasts produced by Consensus Economics. Since that time, numerous economic and political events have occurred that might have changed the perceptions of how the U.S. economy will perform in 2019. To analyze how events in the last six months such as the 35-day shutdown of the federal government, the turmoil in trade relations with China, and the periodic inversion of the yield curve have changed economic perceptions, the Commission will compare what economic forecasters predicted in November 2018 and what they think now.
REVENUE: WEAKER MAY REVENUES REFLECT POOR FEDERAL RECEIPTS; OTHER LINES EXPERIENCE MIXED RESULTS
Jim Muschinske, Revenue Manager
After a stunning April which saw receipts jump over $1.5 billion, May receipts relinquished some of the previous month’s gains as base general funds revenues fell $222 million. The majority of the falloff stemmed from a very weak month for federal reimbursement, as the other lines were mixed. While personal and corporate income taxes eased after an explosive April, sales tax receipts posted another month of solid gains.
Excluding interfund borrowing, last year’s $2.5 billion bond proceeds transfer and the $750 million related to the Treasurer’s Investments this fiscal year, base general funds thru May of FY 2019 are $67 million higher than last year. With only one more month left in the fiscal year, gross personal income tax is up by $1.713 billion, or $1.424 billion net. Gross sales tax receipts are up by an impressive $598 million, or $561 million net. Gross corporate income taxes are up by $452 million, or $391 million net. All other tax sources combined added $84 million in gains.