DALLAS - Kansas revenues exceeded expectations in February by $22 million, lending support to Gov. Sam Brownback's contention that lower tax rates would promote a stronger economy.
The February rebound reversed January's report that monthly revenues were $47 million below forecast.
Since the beginning of the fiscal year July 1, the state has collected $3.55 billion in taxes, about $37 million or 1% below projections.
Brownback credited a growing workforce for the positive numbers. The Republican governor announced Feb. 20 that the state recorded a record number of new business filings in 2014 at 15,780.
"This mark of health for the Kansas economy is the result of our pro-growth tax policies," Brownback said. "Lifting the income tax burden from small businesses provides hard-working entrepreneurs the flexibility they need to create thriving businesses."
Revenue Secretary Nick Jordan said personal income tax collections of $92 million were 42% higher than expected in February.
Jordan also noted that Kansas' unemployment rate of 4.2% in December was nearing historically low levels as the state continues to add jobs.
At Brownback's urging, legislators reduced personal income taxes in 2012 and 2013, arguing it would stimulate the economy. The state dropped its top rate 29% and exempted 281,000 business owners and 53,000 farmers from income taxes.
The drop in individual income tax revenues after those cuts was sharper than expected. But the Brownback administration blamed President Obama for the falling revenues.
With $3.17 billion of tax-supported debt, Kansas is rated AA by Standard & Poor's with a negative outlook after a one-notch downgrade Aug. 6. Moody's rates the Sunflower State Aa2 with a stable outlook.
Kansas's per capita debt load of $1,112 is above the median of $1,074, Moody's says.
