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Kentucky General Fund receipts rise 4 percent

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ROGER ALFORD | October 11, 2013 08:52 AM EST | AP

FRANKFORT, Ky. — FRANKFORT, Ky. (AP) — Tax collections rose substantially in September, providing a needed boost to Kentucky's General Fund, which has been struggling with flat revenues in recent months.

State Budget Director Jane Driskell released a monthly financial report on Thursday showing General Fund receipts up 4 percent compared to the same period a year ago. Revenue topped $920 million for the month, compared to $885 million in September 2012.

The growth came from some of the state's top revenue producers, including sales, income and property taxes.

"Sales and use tax receipts increased for the second month after posting declines in five of the previous eight months," Driskell noted.

The 2.8-percent growth in sales tax revenue and the 4.1-percent increase in individual income tax collections paled in comparison to the 22.8-percent spike in property tax receipts.

Corporate income tax collections also showed a healthy increase of 7 percent.

The September report showed coal severance tax revenue continuing to plummet. With the mining industry in a slump and layoffs rampant, revenue from the tax fell another 20.3 percent.

James River Coal announced in September that several eastern Kentucky mines were being shut down because of the weak coal market. The Virginia-based company said the closures would result in the layoffs of some 525 full-time employees.

The mine closures were in Floyd, Harlan, Johnson, Leslie and Pike counties.

Driskell, the top budget adviser to Gov. Steve Beshear, also reported lottery revenue down by 5.7 percent. Cigarette tax collections continued their downward trend, too, falling another 4.2 percent.

The report contained good news for the state's Road Fund, which grew by 23.8 percent for the month. Total Road Fund revenue in September was more than $137 million.

Fuel tax collections were up more than 20 percent. Revenue from motor vehicle usage fees increased more than 31 percent. And license and privilege tax receipts jumped 20.1 percent.

"The large rate of growth in September is more a function of weakness in last year's receipts than outstanding performance in the current month," according to the report.