DALLAS - A surge in income tax receipts in April means that Arizona will not need to tap its rainy day fund to balance the current fiscal year's budget, officials reported.
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Corporate income tax receipts grew by 43% to $126 million for the month.
April income tax receipts were $141 million above the enacted budget forecast. Preliminary year-to-date General Fund revenues are $228 million above the enacted budget forecast, according to the report.
Because of the surprisingly strong revenues, the state will not need to transfer $144 million from the $464 million rainy day fund to keep the current fiscal year's budget in balance.
Only two months remain before the next fiscal year begins. Gov. Doug Ducey signed a lean $9.1 billion budget for the 2016 fiscal year that prompted a Moody's Investors Service upgrade in the state's issuer credit rating to Aa2 from Aa3 on May 4.
Standard & Poor's has a positive outlook on its AA-minus rating and is expected to announce whether the state will get an upgrade this month.
Fiscal 2015 is expected to end with a $12 million balance, or 0.1% of overall spending. Fiscal 2016 is expected to end with less than $1 million left over.
The current budget plan anticipates leaving the state with a $16 million shortfall in fiscal 2017 before reaching a $33 million surplus in fiscal 2018.
"The enacted budget presumed a $144 million Budget Stabilization Fund transfer," the legislative budget report noted. "If the current forecast trend holds, that transfer would no longer be required."
The upcoming budget is expected to provide less money on state services as a share of the state's combined personal income than any spending plan since at least the 1970s, according to Tom Rex, associate director of the Center for Competitiveness and Prosperity Research at the W.P. Carey School of Business at Arizona State University.
Among the institutions taking the hardest hit are the state's universities.
The 2016 budget will cut funding to universities by a further $99 million, a decrease of an average 13% from each university's current state operating appropriation, according to Moody's.
