Maine tax revenues outperforming expectations
Maine’s revenue collections continue to outperform budget writer’s expectations, with a projected surplus nearly six months into the first fiscal year.
That’s according to Gov. Janet Mills’ administration, which says the state’s general fund revenues are up $822 million or 9.7% for fiscal years 2022 and 2023 compared to initial projections in the biennial budget.
Mills said her administration plans to look at using the additional revenue “to provide direct financial relief to folks hard hit by these increases to help them through these difficult times.”
“The increased costs of electricity, home heating fuels, gas at the pump, and other necessities are putting a real strain on the budgets of Maine people, which is even more difficult during the harsh winter months,” she said.
Kirsten Figueroa, commissioner of the state Department of Administrative and Financial Services, attributed the state’s economic recovery to “prudent budget management” and more than $15 billion in federal pandemic relief.
“We remain committed to utilizing resources in a fiscally responsible manner and to ensure the stability of state finances over the long-term,” she said in a statement.
In July, Mills signed a two-year, $8.5 billion budget that includes pandemic “hazard” payments to workers and a historic level of school funding.
A key provision of the proposal includes $187 million to meet the state’s obligation to pay 55% of local education costs, which was mandated under a previous state law.
The plan also includes $275 one-time “hazard” payments for workers earning less than $75,000 per year, or joint filers making less than $150,000, who worked during the pandemic.
Maine’s nonpartisan Revenue Forecasting Committee noted that a range of factors, including low interest rates, federal stimulus and increased consumer activity, have improved the state’s economic outlook.
Mills said the better than expected revenues have boosted the state’s “rainy day” reserve funds to a “historic” $491.9 million.
That has helped preserve Maine’s creditworthiness amid the pandemic, Mills noted, with both of the primary credit rating agencies affirming the state’s solid financial footing.
Moody’s Investors Service and S&P Global Ratings have reaffirmed Maine’s “strong credit ratings and stable outlooks,” the Mills administration noted.
This article was originally posted on Maine tax revenues outperforming expectations
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