State revenue collections jumped again last month, aided by a growing economy and increases in gas taxes that lawmakers approved to pay for new road and bridge projects.
Gov. Nathan Deal announced Monday that August collections were up 13.6 percent last month, an increase of $190 million over August 2014. During the first two months of the fiscal year, revenue collections have improved almost 10 percent.
The new state fiscal year began July 1. Collections increased 6 percent last fiscal year, and state reserves were expected to end the year well over $1 billion once all the agency surpluses were accounted for.
State finances have been bolstered the past few months by new revenue generated by House Bill 170, which raised taxes to pay for new and expanded roads and bridges. Tax collections on motor fuels last month were 43 percent higher than in August 2014, and the increase made up almost one-fourth of the state’s revenue gain last month.
But individual income tax collections also increased 11.3 percent, and the net sales tax take rose 7 percent in August. Corporate income tax and car purchase fee collections improved as well.
Those gains, after a strong July and better-than-expected fiscal 2015, are good news for a state that took a huge financial fall during the Great Recession.
Deal and Capitol leaders remember the years of spending cuts, layoffs and furloughs, and they continue to take a conservative approach to state finances.
The governor in July put state agencies on notice that he didn’t want them to recommend big spending increases for the upcoming year.
His office sent out instructions to state agencies telling them to submit budget requests for the next year that mimic what they are spending now.
Key agencies with growing enrollment, such as those for k-12 schools and public health programs, will get the bulk of the new money that is not dedicated to transportation projects.
The Department of Community Health board last month asked Deal to include more than $200 million extra in spending in the midyear 2016 budget and the budget for fiscal 2017, which begins July 1. Much of the increase is due to growing enrollment in Medicaid, the state-federal health care program for the poor and disabled, and rising costs for relatively new specialty drugs.
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