State revises FY15 revenue down

THE R.I. DEPARTMENT OF REVENUE released a corrected FY 2015 monthly revenue assessment report for July 2014. The chart shows the corrected numbers, and the decline in revenue. The department previously reported a surplus for July 2014. / COURTESY R.I. DEPARTMENT OF REVENUE
THE R.I. DEPARTMENT OF REVENUE released a corrected FY 2015 monthly revenue assessment report for July 2014. The chart shows the corrected numbers, and the decline in revenue. The department previously reported a surplus for July 2014. / COURTESY R.I. DEPARTMENT OF REVENUE

PROVIDENCE – The R.I. Department of Revenue corrected its fiscal year 2015 revenue assessment report for July 2014, determining that two errors were made, resulting in approximately $170,000 less revenue than was budgeted, instead of a previously reported surplus of nearly $300,000.

The corrected report was released on Wednesday; the initial report came out on Aug. 22.

The correction means that total general revenue for July 2014 came in $172,984 less than fiscal 2015’s expected total general revenue of $203.3 million. As a result, the monthly adjusted revenue was $203.1 million, one-tenth of 1 percent less than the estimated numbers.

The DOR previously stated incorrectly that it collected $297,158 more than had been expected in July.

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The error happened because $755,850 of rental vehicle surcharge revenue that was received in July 2014 and had been accrued back to fiscal 2014 were not removed from motor vehicle license and fee revenue in the original version of the report.

As of July 1, 2014, all rental vehicle surcharge revenue was to be deposited in the Rhode Island Highway Maintenance Account in the Imtermodal Surface Transportation Fund instead of the general fund as in prior fiscal years.

Also, $285,708 of interim Medicaid hospital settlement payments received in July 2014 were excluded from departmental receipts revenue under the presumption that this revenue had been accrued back to fiscal 2014. That revenue belongs in fiscal 2015.

As a result of the two errors, July’s total general revenues were adjusted by $470,142, which caused the dip in revenue.

Department of Revenue Director Rosemary Booth Gallogly stated in a press release that “the error committed by the Office of Revenue Analysis in the original version of the report was 100 percent preventable, and I apologize for any confusion that issuing a corrected report will cause for readers of the report.
“That said, the corrected July 2014 monthly results are concerning given that we are starting off the fiscal year trailing enacted estimates. This concern is compounded by the fact that personal income tax withholding payments adjusted revenues are also behind expected revenues. On the bright side, sales and use tax adjusted revenues appear to be off to a good start, which is comforting given that it is the second largest source of state general revenues.”
The entire report can be found at this link: www.dor.ri.gov.
The Revenue Assessment Report is issued on a monthly basis. July marks the first month of the fiscal year.
Expected general revenue is estimated by the Department of Revenue’s Office of Revenue Analysis from the revenue estimates enacted in the fiscal 2015 budget.

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