WASHINGTON -- Virginia' revenue collections are running slightly ahead of projections, potentially alleviating the need for further budget cuts, according to the state finance office.

But the uncertainty of the Virginia economy, coupled with the fact that May and June are large revenue collection months, augurs caution, according to Danny M. Payne, Virginia's deputy secretary of finance.

"Basically, we are right on track with the forecast," said Mr. Payne. "Through April, our collections are right on target. We feel pretty good about where we are, but we want to wait and see how things work out" in the next two months, he said.

State officials forecast revenue collections of $5.4 billion for the current fiscal year, which ends June 30. That represents a forecast of a 1.4% decline from fiscal 1990 collections of $5.49 billion.

Through April, Virginia has collected $4.2 billion in revenues -- representing a 1.2% decline from fiscal 1990 revenues for the same period. This leaves the state in the position where it needs to collect $1.2 billion in May and June to meet its forecast.

Individual income tax receipts showed 3% growth through April, but had been forecast to grow at 3.4%. However, sales tax receipts are higher than forecast. Expected to drop 1.4% from 1990 levels, receipts through April showed only a 0.7% decline.

The biggest surprise to date has been the performance of corporate taxes. Projected to decline 15.6%, receipts have fallen only 9.9% from fiscal 1990 levels.

Paul W. Timmreck, the state's finance secretary, is scheduled to release May collection figures Monday morning at a meeting of the Virginia House's appropriations committee.

June collection figures, which could determine whether the state must undergo another round of belt-tightening are slated to be released August 23 by Gov. L. Douglas Wilder during a presentation to the General Assembly's money committees.

Earlier in the year, officials projected a $2.2 billion budget gap during the 1991 and 1992 budget biennium. That was up from a projected gap of $1.85 billion in December.

To eliminate the gap, Gov. Wilder proposed a range of budget savings, most of which were adopted by the General Assembly. As part of an agreement between lawmakers and the governor, the state may tap part of its $200 million rainy day fund to alleviate pressure on agencies.

If revenues for fiscal year 1991 come in as forecast, Virginia will cancel $105 million of agency budget cuts for the 1992 fiscal year. The cancellation will be offset with money in the reserve fund, which would then stand at $95 million.

Gov. Wilder, who persuaded lawmakers to set up the reserve fund, was reluctant to tap it. Earlier in the year, legislators called on the governor to use the money to alleviate pressures on state agencies and programs. But in his state of the commonwealth address on Jan. 9, Gov. Wilder said the fund was not "a safe-deposit box which should be tossed aside and replaced with a Pandora's box of higher taxes and unrestrained spending."

In the end, a compromise was reached that state officials believe provides sufficient flexibility in the case of any further economic downturn.

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