WASHINGTON, Sept 12 (Reuters) - Virginia’s revenues fell in August by 4.8 percent from the same month a year ago, as individual withholding payments slipped, the state reported on Thursday.
Governor Robert McDonnell said the state had expected the 5.5 percent decrease in withholding from the previous August, after the payments rose by double digits in July.
“While August revenue numbers are slightly down, as anticipated due to the importance of individual withholding payments, Virginia’s overall revenue picture continues to be positive,” McDonnell said in a statement. “We are running ahead of projections on a year-to-date basis, and we continue to make sound investments in areas like transportation.”
For the fiscal year that started in July revenues are up 3 percent, twice the annual forecast of 1.5 percent growth.
From July 2011 through January 2013, Virginia’s revenues had fallen only three times. In 2013, they have also fallen in February and March.
Still, Virginia was able to end fiscal 2013 on June 30 with a surplus of $585 million, the largest in eight years, after seeing double-digit gains in other months.
Due to its proximity to the nation’s capital, Virginia weathered the 2007-09 recession better than many other states and has enjoyed a strong recovery. Yet, the state is considered especially vulnerable to the federal spending cuts known as sequestration because of the military presence there as well as heavy federal spending on contracts and salaries.