Thanks largely to “a steadily growing economy,” North Carolina state government experienced another major budget surplus for the fiscal year that just ended June 30.
According to a fiscal research division report released this week, the state collected $400 million more revenue than forecast. The largest driver (in dollar terms) of the surplus was the collection of $176 million in excess income taxes compared to projections. Higher-than-expected tax revenue means the state’s economic growth is exceeding expectations.
This marks the fourth straight year of budget surpluses exceeding $400 million – good for a total of $1.8 billion in surpluses during that time. A significant portion of the surpluses have been set aside into the state’s “rainy day” fund, which now totals more than $1.8 billion – an all-time high. Having these funds set aside positions North Carolina to be far better prepared to weather the next recession, enabling budget writers to avoid imposing tax hikes when citizens can least afford them.
Of course, these major surpluses fly in the face of the laughably off-base hand-wringing about massive budget shortfalls over the last few years coming from fear-mongers who prefer a return to the damaging tax-and-spend policies of the past.