States saw a revenue rebound through February. How did Pa. do? | Monday Morning Coffee

May 10, 2021 7:12 am

Good Monday Morning, Fellow Seekers.

Despite a gloomy jobs report last week, here’s another sign that the economy is slowly making its return to pre-pandemic levels: State tax revenues had recovered enough by February, that 29 states reported taking in as much, or more, revenue as they did in the 12 months prior to the pandemic, a new analysis by the Pew Charitable Trusts has found.

Using preliminary monthly data compiled by the Urban Institutethe Pew analysis found that Idaho was the leader among states, taking in 11 percent more tax revenue as of February compared to pre-pandemic levels.

A caveat: “Total state tax receipts were only 0.01 percent higher for March 2020 through February 2021 compared with the same months a year prior, based on the institute’s preliminary data, which covers 49 states and is the most current available,” Pew noted. “This means that for states collectively, cumulative tax revenue since the onset of COVID-19 reached pre-pandemic levels for the first time, though without adjustments for inflation.”

Below, a look at some state-by-state highlights, and an update on Pennsylvania’s revenue picture as the Republican-controlled General Assembly and the Democratic Wolf administration start moving into budget season in earnest.

This image requires alt text, but the alt text is currently blank. Either add alt text or mark the image as decorative. (Image via The Pew Charitable Trusts)

The Pew research concluded, among other things, that:

  • “Tax revenue in 29 states had overcome its pandemic-driven losses, with the largest gains from prior year collections in Idaho (11 percent), Utah (8.7 percent), Colorado (8.0 percent), South Carolina (7.7 percent), and South Dakota (7.2 percent).
  • “Losses still exceeded gains in at least 18 states, with collections running furthest behind in Alaska (-49.2  percent), Hawaii (-17.4 percent), North Dakota (-10.9 percent), and Texas (-10.3 percent). In addition, tax revenue through January also was running behind in Nevada (-10.8 percent), and New Mexico (-2.5 percent).
  • “South Dakota is the only state that avoided posting any loss in its cumulative revenue since the start of the pandemic, compared with the prior 12 months. By contrast, 10 states consistently reported losses: Alaska, Arkansas, Hawaii, Minnesota, Missouri, Nevada, Oklahoma, Oregon, Pennsylvania, and Texas. (Nevada’s data was through January.)
  • “Among the states that have overcome early pandemic losses, Idaho in June 2020 was the first to see its cumulative revenue return to pre-pandemic levels—after just four months. It was followed a month later by Colorado, Georgia, Nebraska, and Vermont.
  • “Maine, Rhode Island, and Virginia slipped out of early tax revenue recoveries mid-year, but all three states are again reporting gains in cumulative revenue compared with prior year collections.
  • “Six states’ cumulative tax collections grew enough to offset prior losses for the first time in February: Ohio (0.1 percent), Illinois (0.1 percent), Iowa (0.2 percent), Massachusetts (0.2 percent), Delaware (0.4 percent), and New York (0.5 percent).
  • “Although no monthly tax revenue data was available for Wyoming, the state’s own revenue forecast in January projected a 23 percent drop in fiscal 2021 in the two main accounts that fund general operating expenses, following an 18 percent loss in fiscal 2020,” the Pew analysis found.
(Getty Images)

As noted above, Pennsylvania was among 10 states that consistently reported revenue losses during the time-frame in the Pew data. But according to the latest state Department of Revenue data, there may be some cause for encouragement.

The state collected $4 billion in general fund revenue in April, which was $28.2 million, or not quite a percentage point more than anticipated, according to Revenue Department data. Year-to-date collections total $32.7 billion, which was $1.3 billion, or 4.2 percent, above estimates.

Now a closer look at the numbers: Personal income tax revenue in April totaled $1.7 billion or nearly $572 million below estimate, which the agency puts down to the extended tax filing and payment deadlines for 2020. The new deadline is May 17 and officials say they expect to make up the lost PIT income at that time. As I noted last week, states’ personal income, driven by an influx in federal aid, hit a 20-year high in 2020. And Pennsylvania was one of nine states where government transfer payments increased by at least 20 percent from the fourth quarter a year ago.

Any PIT shortfalls in April, the state said, were made up for with stronger corporate ($551.2 million) and sales tax ($1.2 billion) collections, which respectively were $251.8 million and  $273.1 million ahead of estimates.

“The good news is that Pennsylvania’s economic outlook is much improved from November, when we created our monthly revenue estimates that anticipated a much slower recovery from the impact of the COVID-19 pandemic,” Revenue Secretary Dan Hassell said in a May 3 statement. “As of today, we are more than $1.3 billion above our estimate for the fiscal year. This is very positive news with two months to go in the current fiscal year.”

The brightened outlook is reflected in the Pew analysis, with the additional caveat that “a few states with high proportions of leisure and hospitality jobs and certain energy states may continue to face challenges.”

Pennsylvania State Capitol Building. (Capital-Star photo by Cassie Miller.)

Our Stuff.
In this week’s edition of The Numbers RacketCassie Miller delves into a new report concluding that the majority of Americans see the decades-long decline in unionized workers as “bad” for workers.

Faced with grim climate projections, state officials are calling for a multi-dimensional approach to addressing climate change, Miller and Stephen Caruso report.

Pittsburghers spoke out recently on the displacement of the city’s Black residents, delivering a stark message to local officials, our partners at Pittsburgh City Paper report.

Philadelphia’s Valley Youth House has souped up its resources for LGBTQ youth, and plans to revive its Host Homes program for LGBTQ youth, our partners at the Philadelphia Gay News report.

Florida Gov. Ron DeSantis’ sham press conference last week, where he signed a suite of new voting restrictions into law, is just more proof the GOP isn’t interested in governing or majoritarian rule, I argue in a new column.

On our Commentary Page, Philadelphia Tribune columnist Michael Coard runs down all the reasons Black voters need to care about this year’s judicial elections. Yes, U.S. Rep. Liz Cheney, R-Wyo., is right to stand up to the GOP – but don’t forget her father, ex-Veep Dick Cheney lied the nation into war, opinion regular Dick Polman writes. Reducing methane is crucial for protecting climate and health, and it can pay for itself —  so why aren’t more companies doing it, a Duke University expert asks.

En la Estrella-Capital: Una nueva iniciativa tiene como objetivo dar a los residentes de Pensilvania con discapacidades intelectuales y de desarrollo un mayor acceso a las vacunas. Y juez federal suspende la sentencia que invalida la prohibición de desalojo del CDC en todo el país.

The Inquirer
 talks to crime victims who are opposing Philadelphia District Attorney Larry Krasner’s re-election.
In a Mother’s Day debate, Pittsburgh’s mayoral hopefuls went after incumbent Mayor Bill Peduto’s record on policing, the Post-Gazette reports.
PennLive looks at how area high schools are preparing for graduation ceremonies this year.
The Morning Call has its procrastinator’s guide to the 2021 primary in the Lehigh Valley.
The Citizens’ Voice looks at the Republican race for Luzerne County Council.
New legislation would let Philadelphia police confiscate more dirt bikes from city streetsBillyPenn reports.

Here’s Your #Harrisburg Instagram of the Day:


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An Erie-area restaurant owner has called COVID-19 inspectors ‘Hitler people,’ GoErie reports.
The Lower Susquehanna Riverkeeper has filed suit against Harrisburg and Capital Region Water, saying they aren’t doing enough to stop pollution, WITF-FM reports.
The Observer-Reporter has its guide to the constitutional amendments on the May 18 primary ballot.
Florida Gov. Ron DeSantis will headline the Allegheny County GOP’s spring dinner on May 20, PoliticsPA reports.
With states pushing for more accountability for police, activists want to keep the spotlight on Black reports.
A U.S. Senate committee on Tuesday will take up a sweeping bill designed to make voting easier. Roll Call has the details.

What Goes On.
The state Senate comes in today at 1 p.m. Here’s a look at the day’s event and committee action.
9 a.m., Community of College of Philadelphia: House Democratic Policy Committee
10 a.m, Capitol Steps: Survivors of child sex abuse rally for two-year look back window for civil cases.
10:30 am. Senate Chamber: Senate Communication & Technology Committee
11:30 a.m., Senate Chamber: Senate Education Committee
Off the Floor: Senate Appropriations Committee

What Goes On (Nakedly Political Edition).
5 p.m: 
Reception for state Senate candidate Chris Gebhard
5 p.m.: 
Reception for Pittsburgh mayoral candidate Ed Gainey
Hit both events, give at the max, and you’re out at least $1,000. Improbably, there’s no ask listed for the Gainey event – but you’re still free to write checks.

You Say It’s Your Birthday Dept.
Best wishes go out this morning to PennLive/Patriot-News head honcho Cate Barron, who celebrates today. Congratulations and enjoy the day.

Heavy Rotation.
Asleep in the Back,’ the debut record from one of my favorite bands, Elbow, celebrates its 20th anniversary this year. And, as you might expect, it’s getting the deluxe reissue treatment with a sprawling, 4-CD set of remixes, b-sides, and live performances. As a starter, here’s the title track. The rest of it is well worth your time. But, of course, that’s just me.

Monday’s Gratuitous Hockey Link.
From, here’s a look at this season’s Calder Cup contendersCarolina goalkeeper Alex Nedeljkovic is rightfully among them.

And now you’re up to date.

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John L. Micek

A three-decade veteran of the news business, John L. Micek is the Pennsylvania Capital-Star's former Editor-in-Chief.