May 4, 2018 / 8:55 PM / 23 days ago

West Virginia reports April revenue upswing ahead of bond deal

May 4 (Reuters) - West Virginia revenue collections beat forecasts by nearly $24 million in April, putting one of the economically weakest U.S. states on track to meet its fiscal year-end targets, Governor Jim Justice said at a press conference on Friday.

The Appalachian state collected $535.3 million in revenue in April, 6.3 percent above the same month last year, mainly due to rising personal income tax receipts, wage and salary withholding and sales taxes, Justice said.

“While things still may not be at the top of the rainbow and everything, things are surely improving,” said Justice, who took office in January 2017 as a Democrat but has since changed party affiliations to become Republican.

Revenue collections now stand at $3.49 billion, nearly reaching year-to-date estimates and hitting 4.4 percent above fiscal 2017 levels, which started with deep shortfalls. West Virginia expects to collect about $4.24 billion by June 30, a record amount for the state.

Justice and top state finance officials discussed the revenue increase at a press conference ahead of the state’s $800 million worth of general obligation bond sales expected later this month.

Fitch, on Friday, was the first major credit rating agency to rate the bonds, giving them a AA score. At the same time, Fitch improved its outlook on West Virginia to stable from negative, where the state has lingered for roughly two years.

West Virginia continues to struggle with population loss, per capita income 75 percent less than the U.S. average and volatility in its critical industries of coal and gas, Fitch said in its rating.

Still, it has managed a recent modest improvement.

The revised outlook reflects “recent stability in key revenue sources, the state’s proactive management of financial operations ... improved expenditure controls for its Medicaid program, as well as modestly stabilizing economic indicators,” Fitch wrote.

The series 2018A bonds are due to price on May 21 and the series 2018B bonds are expected to come to market on May 23. (Reporting by Laila Kearney; editing by Daniel Bases and Susan Thomas)

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