Aside from an exploding brouhaha over Medicaid enhancement payments which cost the state $50.3 million in revenue in November (and a hit in the always nebulous “other” category), revenues for the month were pretty much on schedule.
That may be a tough line to sell if you just look at the numbers. November is traditionally a low revenue month, so the 50 percent shortage in Medicaid monies makes the bottom line look especially bad, $133.4 million for the month or 29.8 percent short of the expected $190.1 million.
However, three revenue sources which will ultimately carry the day—business taxes, real estate transfer taxes, and rooms and meals taxes—all came in ahead of plan for the month, so now is clearly not the time to push the panic button, even as the bottom line will read $45.8 million short (6.8%) for the first five months of the year.
Business taxes were $2.2 million (or 31.4 % of the paltry plan) for the month leaving us $13.3 million over for the year.
Rooms and meals revenues were slightly ahead of the $20.5 million planned and are now $2.5 million (2.2%) ahead of plan for the year.
Real estate transfer taxes came in at $7.0 million, 7.7 percent on the expected $6.5 million and are now $3 million ahead for the five months.
Those are three very good signs indeed whether or not the $50.3 million in Medicaid monies eventually show up.
Sin taxes continue to underperform. Cigarette taxes were off $3.5 million for the month, liquor off $0.4 million, and lottery transfers off $2.9 million. They are off $7 million, $2.3 million, and $2.4 million respectively for the year.
Interest and dividends revenue represents another problem area, generating negative $1.6 million due to refunds. This category is off $4 million for the year.
The $2.9 million shortfall in the “other” category is mostly a timing issue and is expected to be made up.
The best that can be said is that the state indeed seems to be fortunate that Republicans, now in control of the estimates, didn’t go higher as some had urged them to do so that more money could be budgeted. Had Democrats been in control last spring, rest assured that rather than be off $45.8 million for the year with this unpleasant Medicaid surprise, we’d probably be short three or four times that much and facing a major crisis.
One of the numbers crunchers told me to expect to see $10 million of the $50 million shortfall on the Medicaid side recouped in coming weeks, but there is no guarantee.
A full investigation is needed, but the problem should not blind us from the fact that other revenues are performing pretty much according to plan.
For that I say congratulations to House Ways and Means Chair Steve Stephanek and Senate Chair Bob O’Dell.