Kansas tax collections in March close to hitting estimates

? Revenues flowing into the state’s coffers during the month of March fell only $1.7 million short of the official estimates, a much better performance than the state has seen in several months, according to the Kansas Department of Revenue.

That means the state’s financial situation did not become significantly worse during the month. But neither did it make progress toward closing a projected shortfall of roughly $30 million for the current fiscal year.

Lawmakers have already prepared for that possibility, however, by passing a budget bill that gives Gov. Sam Brownback authority to delay a scheduled $100 million payment, although that payment would have to be made up, with interest, in the first quarter of the next fiscal year.

The size of the shortfall is also likely to change later this month when the state’s Consensus Revenue Estimating Group meets to update its forecast of revenue collections for both the current and following fiscal years.

Kansas Revenue Secretary Nick Jordan said he was generally satisfied with the March report.

“After a weak month in February, (payroll) withholding rebounded in March but not quite as strongly as anticipated,” he said. “While corporate income, sales and use tax receipts are up, oil severance payments are down. It is a trend that is contributing to a sluggish economy in many rural counties which depend heavily on oil and commodities.”

According to the March report, individual income tax collections, at just over $145 million, came in $14 million short of estimates for the month. But that was substantially better than the $27 million shortfall reported in February.

But the individual income tax shortfall was offset by better-than-expected sales tax collections. At nearly $182 million, March sales tax collections were $5.9 million above estimates. They were also $19 million higher than in March 2015.

Taxes on insurance premiums also came in $6.7 million above estimates.

For the fiscal year as a whole so far, total taxes flowing into the state are $81.2 million short of the official estimates, which were last updated in November.

That includes a $56 million shortfall in individual income taxes and nearly a $21 million shortfall in retail sales taxes.

“While the March revenue numbers only narrowly missed projected estimates, I still have grave concerns regarding the overall shortfall for the year,” said Kansas House Democratic Leader Tom Burroughs, of Kansas City. “More will have to be done when the Legislature reconvenes in late April to balance the budget and chart a new, fiscally responsible and sustainable path forward.”