(The Center Square) – Maine's revenue collections continue to outperform expectations, with a projected $42 million surplus two months into the first fiscal year.
That's according to Gov. Janet Mills' administration, which says the state's general fund revenues are up $186.5 million or 31.7% compared to the same period last fiscal year, and over budget by $77.9 million or 11.3 % over previous budget projections.
The state also recorded $42.4 million in surplus revenues for August, exceeding expectations by 11.8%, the Mills administration said in a statement.
"State government finances are in excellent shape, with Maine continuing to record surplus revenues and operate in the black," Finance Commissioner Kirsten Figueroa said.
Figueroa cited federal stimulus funds, an "unprecedented" level of savings by the state, and "prudent fiscal management" for helping Maine survive the pandemic financially.
"That we entered the pandemic on such solid footing has made all the difference," she said in the statement.
A report by the state Department of Administrative and Financial Services shows the state's tax revenues continue to exceed budget writers' expectations.
Sales and use tax revenue is $23.3 million over budget for the month, and about $54 million over budget for the current fiscal year, the report noted.
Overall, sales tax receipts have increased nearly 30% over the previous fiscal year.
Corporate income tax was over budget by 2.7 million, while individual income tax revenue was 11 million or 7% higher over budget for the month, according to the report.
Mills signed a two-year, $8.5 billion budget that includes pandemic "hazard" payments to workers and a historic level of school funding.
A key provision of the proposal includes $187 million to meet the state’s obligation to pay 55% of local education costs, which was mandated under a previous state law.
The plan also includes $300 one-time "hazard" payments for workers earning less than $75,000 per year, or joint filers making less than $150,000, who worked during the pandemic.
The provision is projected to cost the state an estimated $150 million but benefit about 500,000 taxpayers.
Meanwhile, Maine's creditworthiness also survived the pandemic, with both of the primary credit rating agencies affirming the state's solid financial footing.
Moody’s Investors Service and S&P Global Ratings have reaffirmed Maine’s "strong credit ratings and stable outlooks," the Mills administration noted.