This extraordinary situation forcefully underscores the need for spending caps, lower debt, and higher reserves to better cushion us during times like these. Unfortunately, we’re seeing very few signs that the current economic downturn is easing.
It's a position which has been taken by the Blogland on more than one occasion. In fact four times in the last nine months:
Individual income tax receipts showed the largest declines. They were 48.4% ($175 million) lower for May 2009 than for May 2008. This followed a 38.9% ($129 million) decline for April 2009 over April 2008. On a fiscal year-to-date basis (July through May), individual income tax receipts are 16.1% ($476 million) below the prior year.
Corporate income tax receipts were down 40.7% for May, following a decline of 35.4% for April, resulting in a year-to-date decline of 17.3 % ($44 million).
Sales and use tax collections fell 15.7% ($33 million) last month and 8.7% ($177 million) so far this year.
Revenues from all sources fell 35.5% ($226 million) in May following declines of 24.5% ($149 million) in April. Through May 2009, total revenues have plunged 12.8% ($756 million) for the year.
For those who haven't done their math, $756 million represents about one-quarter of the $3 billion in surplus revenue the state blew in recent years. If half the state's recent surplus revenues had been banked away, it would've taken care of this year and last year's shortfalls.
The Blogland has said it before, but since Eckstrom is saying the same thing, we'd like to join him in calling for more responsible management of state revenues in good years so the next downturn won't result in such a political train wreck.
Since the state's elected officials have a responsibility to serve the people of the state, it seems as if a little fiscal responsibility isn't too much to ask.