NC Grows Its Pot Of Money Despite Losing Revenue
North Carolina's main pot of money increased about 19 percent during the last fiscal year despite a decrease in revenues. That's according to the state controller's annual financial report released Monday.
You know how when revenues are down, a business can still turn a profit if it cuts expenses? That's basically what North Carolina did with its General Fund, the pot of money the state uses to pay for most of its programs.
For the fiscal year that ended in June, North Carolina's revenues came in about $450 million short of projections.
The state controller says that's largely because of tax cuts Republican state lawmakers passed. Individual income taxes dropped, although the loss was partially offset by growth in corporate and sales tax revenue.
But the pot of money still grew because North Carolina spent less. The state basically saved $400 million compared to the year before by dramatically reducing its Medicaid shortfall. And the state controller reports tax refunds were down significantly, and that usually happens as the economy improves and more people find jobs.
(The annual report covers up to June 30, 2014. Revenues have continued declining into the new fiscal year, according to another report.)