FRANKFORT — Tax collections for the state Road Fund fell 20.5 percent in September while receipts for Kentucky's General Fund, which pays for most state programs, rose a modest 2.6 percent.
State budget director Jane Driskell said a decline in motor-fuels tax receipts impeded the Road Fund, which pays for road projects. It had revenue of $110 million in September, compared to $138 million in September 2014.
Driskell said motor-fuels tax collections have dropped sharply this fiscal year, which began July 1, because of a drop in the tax rate.
She also said motor-vehicle usage tax receipts had been artificially high in the first two months of the fiscal year because of timing issues. That trend reversed in September, bringing a 26.3 percent decline, she said.
Digital Access For Only $0.99
For the most comprehensive local coverage, subscribe today.
The official Road Fund revenue estimate calls for a 2.1 percent increase in receipts for the entire fiscal year, which ends next June 30, compared to last year's actual receipts.
Based on collections so far this year, revenues must increase 5.8 percent for the remainder of this fiscal year to meet the estimate. If the estimate is not met, the state must make cuts in the Road Fund to meet the constitutional mandate of a balanced budget.
General Fund receipts for September were $945 million, compared to $920.6 million in September 2014.
The General Fund has grown 4.5 percent so far this fiscal year.
Income and sales taxes continue "to be the engine of growth for Kentucky's fiscal economy," Driskell said.
The official General Fund revenue estimate for this fiscal year calls for revenue to grow 1 percent compared to last year's actual receipts.
Based on September's results, General Fund revenue needs only to remain flat for the remainder of this fiscal year to meet the official estimate.
A group of independent economists who predict how much money the state will take in — known as the Consensus Forecasting Group — will meet Tuesday to work on a revised forecast for the General and Road Funds for the next two fiscal years.
The state legislature and the governor will use the projections to write the next two-year state budget.