The Fiscal Research Division of the North Carolina General Assembly has published its General Fund Revenue Update, and I will share some of the highlights presented in that report.
Of course, it is my opinion that the report confirms that the Republican majority in the General Assembly has enacted fiscally responsible budgets, properly reduced taxes and measured regulatory reform resulting in excellent economic results.
The balance of what I write — except for the closing — is not opinion but facts.
The FY 2018-19 first half net revenue collections were $188.6 million above the revenue target and were down in only a few target areas. If this continues this year and next year, the state will have six straight budget years with surplus revenue.
The summary states, “Since the economy remains on solid footing, the risk of the state not reaching the projected revenue for the fiscal year is minimal.”
The personal income tax collected was up 0.7 percent or $40.5 million, and the wage and salary withholding was up by 2.2 percent or $114.1 million.
Sales and use taxes were ahead of target by 1.1 percent or $41.1 million, and the growth exceeded the base line growth projections of 4.4 percent by hitting a super strong 6.8 percent growth for the first half of the year.
One of the big helps was the Supreme Court’s ruling in June 2018 that gave states additional authority to require out-of-state retailers to collect and remit sales taxes.
There was a big jump from corporate income and franchise taxes, which were up 16.5 percent over last year. The report stated, “These two sources combined are $82.9 million above the six-month target.”
The non-tax revenue was down slightly at minus 1.2 percent, but the investment income that was projected to be $45.6 million actually generated $70.3 million in the first half of the year.
The state of North Carolina is now experiencing the second-longest recovery from a recession in its history, and if it continues for another six months, the state will exceed the 120-month expansion that occurred from March 1991 to March 2001.
Additionally, in the last year 82,700 jobs have been added in the private sector and 4,500 jobs in the governmental sector. There are now 4,818,454 people employed in the state, which is an increase of 74,190 over the last year, and the state’s unemployment remains at record lows for all categories.
During the past eight years, the state’s rainy day fund has increased from almost nothing to $1.8 billion. This allowed the General Assembly to appropriate the largest amount ever of $240 million to help the hard-working farm families across North Carolina without raising any taxes.
Additionally, the report stated, “North Carolina is receiving national accolades for its economic success, winning the 'Best State for Business' study by Forbes two years in a row, placing top-two in the prestigious 'Prosperity Cup' four years in a row, and placing third in CEO Magazine’s 'Best and Worst States for Business’ the last two years.”
The nation’s top credit rating agencies have given North Carolina a unanimous AAA rating.
The Republican majority in the General Assembly has accomplished all this, while at the same time lowering taxes, reducing regulations, and raising teacher and state employees’ salaries.
We, the people, should arm ourselves with facts before going into the voting booth if we want the state of North Carolina to continue as a great place to live and work.