Virginia Surplus Will Total $311 Million

Toscano Response

Delegate David Toscano (D-Charlottesville) released the following statement:

“While this budget surplus is certainly preferable to a shortfall, we should be clear about its origins. First, our national economy is improving and revenues are up as a result. Second, we neglected our obligations in the last budget to adequately fund our state’s retirement plan.  Third, the surplus was generated because of substantial cuts made to localities and our social safety net.

"These substantial cuts to localities and our failure to honor our commitment to state employees to adequately fund their pensions are not consistent with responsible budgeting. Restoring funds now to the retirement system is simply what we should have done two years ago. And maintaining assistance to localities is key to keeping property taxes low.

It is important that we honor our commitments in a timely fashion that is transparent and without gimmicks. Generating surplus on the backs of localities and our state employees is not only disingenuous, but is a disservice to the taxpayers of the Commonwealth.”

July 19, 2011

Virginia's state government ended its last fiscal year on June 30 with a surplus of $311 million, according to state documents obtained by The Associated Press.

Gov. Bob McDonnell plans to detail how the state ended the year with the unspent balance at a Tuesday news conference.

After three years of revenue shortfalls, Virginia cut spending, found savings and used federal stimulus cash to balance budgets the past two years.

The bulk of the surplus comes from individual income tax collections that exceeded their forecasts by nearly $200 million, according to a draft analysis of final revenues from fiscal year 2011.

The year's general fund collections totaled $15.45 billion, the draft shows. The official estimate of state revenues, which is used for budgeting, was only $15.14 billion.

Taxes withheld from individual paychecks totaled $9.63 billion, topping the $9.57 billion forecast. Income tax withholding accounts for nearly two-thirds of Virginia's general fund, which covers such core services as health care services, law enforcement and public safety and public education.

Taxes paid by the self-employed and on investments exceeded their official target of slightly more than $2 billion by $110 million. Income tax refunds were nearly $28 million less than expected.

Corporate income taxes grew by 3 percent rather than the projected decline of almost 5 percent from fiscal year 2010 collections.

Retail sales taxes fell by 2.3 percent from the previous year, but that still beat the state's own forecast for a 3.7 percent drop-off.

Detailed figures for June, the final month of the fiscal year, won't be available until McDonnell updates House and Senate budget-writing committees next month.

Much of the excess is already obligated. State law already designates a share for a Chesapeake Bay cleanup fund, and for transportation.

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