INDIANAPOLIS | State revenue was well below expectations through the first third of the budget year, even though Indiana in October exceeded its monthly revenue target for the first time since June.
October revenue totaled $1.05 billion. That's $9 million, or 0.9 percent, more than predicted by the revenue forecast. At the same time, it's $35.6 million, or 3.3 percent, less than the state took in last October.
Sales taxes, Indiana's greatest revenue source, brought in $563.9 million last month, 2.9 percent percent below expectations. Since July, sales tax revenue has grown 2.1 percent compared to last year, but budget writers predicted 3.9 percent growth.
Revenue from personal income taxes has dropped significantly compared to last year, and that's before a 0.1 percent rate cut takes effect Jan. 1, 2015.
In October, the $334.4 million in income tax revenue beat the monthly target by $14.6 million, or 4.6 percent.
But the target was set $32.8 million below last year's October income tax revenue, resulting in a 5.2 percent drop compared to last year.
Income tax revenue since July totaled $76.6 million, or 4.9 percent, less than the same July-Oct. period one year ago. The revenue forecast predicted 5 percent growth.
In addition, corporate income tax revenue and riverboat wagering tax revenue -- both of which were predicted to decline compared to last year -- are down nearly twice as much as expected.
Overall state revenue is $64.5 million, or 1.4 percent, below the forecast, and down $68.2 million, or 1.5 percent, compared to last year. The forecast predicted 2.5 percent year-over-year revenue growth.
The Pence administration last month directed state agencies to trim spending wherever possible to maintain Indiana's $2 billion budget reserve in the face of lackluster revenue.