The state's gasoline tax collections, are one of the few taxes running below last year.
Phillip Rawls - AP - Sept. 10, 2006
Gas tax $ downturn is due to people driving less and driving hybrid cars to get better FE.
Alabama's economy is growing so fast that state government has collected more taxes in the first 11 months of this fiscal year than it did in all 12 months last year.
Alabama's net tax collections after refunds through the first 11 months of this fiscal year totaled $7.15 billion. That compares with $7.11 billion collected through all of fiscal 2005.
According to the state Revenue Department, tax collections are running more than 9 percent ahead of last year, which was an upbeat year, too.
State Finance Director Jim Main calls it "a tremendous increase" because it's compared against a year that also saw a big increase in tax revenue.
Mike Mason, director of the Revenue Department's Tax Policy and Research Division, said the biggest contributor to Alabama's tax revenue growth is an unemployment rate that keeps falling below the national average month after month.
Also, he said Alabama never experienced the rapid appreciation in housing prices that some states had in recent years, so Alabama didn't have its housing market collapse like some states this summer.
"All in all, this year to date has been remarkable for its growth," Mason said.
The news is especially good for the state education budget. It's primary sources of revenue are sales taxes (up 9 percent from last year), individual income taxes (also up 9 percent), and corporate income taxes (up 21 percent).
Those increases have come without any changes in tax rates.
Main said the state should end up collecting about $200 million more in education taxes than the Legislature appropriated for public schools and colleges in fiscal 2006. Most of that extra money will go into a rainy day fund to be used for public education when the state has an economic downturn.
Collections for the General Fund budget for non-education agencies have benefited from higher oil and natural gas prices. Alabama's oil and gas privilege tax, which comes from wells on the mainland and along the coast, is running 32 percent ahead of last year.
The General Fund has also benefited from something that is not a tax: the interest earned on state deposits. Interest earnings are up 48 percent from last year.
Main said oil and gas taxes and interest rates should help the General Fund end up $75 million to $95 million above appropriations, although that is still a very rough estimate.
The state's gasoline tax collections, which fund highway construction, are one of the few taxes running below last year (down 0.78 percent).
The tax, which is fixed and doesn't fluctuate with the price of gas, normally grows by about 1 percent to 2 percent a year. Mason said the downturn is due to people driving less in response to higher gas prices and doing like he did recently - buying a hybrid car to get better gas mileage.
The state wraps up its fiscal year Sept. 30.