A Follow Up to the Absence of a Muni Crisis in the US

On October 4th I wrote “One Crisis that Did not materialise”, which discussed the fact that the fears of hundreds of billions of dollar losses from defaults in the municipal bond market proved wide of the mark.  

Many were sceptical. Here is the latest data.

The Rockefeller Institute’s analysis of Census Bureau data found that preliminary data for the July-Aug period indicated that state revenues are up an average of 6.8% in the 41 states that reported early.  

In the second quarter, total state tax revenues increased by 10.8% year-over-year.  

This marked the sixth consecutive quarter of growth and the strongest annual figures since 2005. Local governments are not doing gas well. 

Tax revenue has fell 1% in Q2 year-over-year and is the third consecutive quarterly decline.   

This is a sign of the depressing real estate market. Property taxes are nearly three quarters of local tax revenues.

In contrast sales tax account for about 15% of local tax revenues. 

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