With the end of its first fiscal quarter wrapping up, Pennsylvania state government brought in about $200 million less than expected.
That’s not great news for the commonwealth that’s currently using a credit line from the state treasury to pay off its immediate costs. However, it’s too early to tell if the shortfall will have any real financial impact.
Revenues were weak across the board, but, the shortfalls were most severe in sales and corporate tax income.
Matthew Knittel, director of the state’s Independent Fiscal Office, said he’s not sure what’s causing the weakness. He also noted there were some sales tax gains last month, so it’s unclear if the deficits will continue.
He said the office will know more when additional data comes in later this month, but notes outside factors could be affecting revenue.
“We always expect a little bit of uncertainty when there’s a presidential election,” he said. “Businesses and individuals tend to go into somewhat of a holding pattern and wait until the election is resolved.”
Knittel said several neighboring states are seeing similar patterns.
The state revenue department echoed the IFO’s assessment.