State revenue falling below budget, past year

JEFFERSON CITY, Mo. -- Revenue for the first quarter of Missouri's fiscal year fell 2.7 percent from last year, raising concerns among state budget officials.

The decline reported Wednesday by the state Department of Revenue becomes more pronounced when compared to the 3.1 percent growth that had been anticipated in Missouri's fiscal 2003 budget.

For July, August and September, Missouri's tax revenue were $76.5 million below what was budgeted, said state budget director Linda Luebbering.

State is concerned

"It is of a concern," Luebbering said. But "it is not on the magnitude of where we were last year at this time."

During the fiscal year that ran from July 2001 through June 2002, state economists repeatedly lowered their revenue forecasts and Gov. Bob Holden cut hundreds of millions of dollars from the budget.

Holden has not made any budget cuts this year but has not ruled them out.

"We want to do a little bit more in-depth analysis before we pull any type of trigger on this," Luebbering said.

Individual income taxes -- the largest segment of Missouri's revenue -- were down 0.3 percent from last year for the first three months of the state fiscal year, the Revenue Department said.

Sales, use taxes up

Sales and use taxes -- the state's second largest revenue source -- were up 2 percent over that same period, the department said.

The state's interest income and estate taxes were down significantly from last year while tax refunds are up almost 27 percent -- a change expected by budget forecasters.

Missouri is in its secondstraight year of declining revenue.

In fiscal 2002, the state's net general revenue declined 3.5 percent from fiscal 2001 -- the first decline since fiscal 1955, when Missouri's tax revenue were but a tiny fraction of today's.

The revenue decline last year was especially pronounced because the state budget had assumed 5.6 percent growth.