January GRF receipts miss estimate by 17.2%
Deeper midyear reductions necessary
OKLAHOMA CITY — General
Revenue Fund (GRF) collections continued tumbling in January, missing the
estimate by 17.2 percent and the prior year by 16.2 percent, as the effects of low oil
prices became more pronounced.
As state
government’s main operating fund, the GRF is the key indicator of state
government’s fiscal status and the predominant funding source for the annual
appropriated state budget. GRF collections are revenues that remain for the
appropriated state budget after rebates, refunds and mandatory apportionments.
Gross collections, reported by the State Treasurer, are all revenues collected
by the state before rebates, refunds and mandatory apportionments.
January
GRF collections of $507.6 million were $105.5 million, or 17.2 percent, below
the official estimate upon which the Fiscal Year 2016 appropriated state budget
was based, and $98.1 million, or 16.2 percent, below prior year collections.
Total
GRF collections for the first seven months of FY 2016 were $3.1 billion, which
is $277.6 million, or 8.2 percent, below the official estimate and $280.5
million, or 8.3 percent, below prior year collections.
The
Board of Equalization meets Feb. 16 to update FY 2016 and FY 2017 revenue
projections.
“When
the board updates the current year projections, it will require a deepening of
the midyear general revenue reductions made following December’s revenue
failure declaration,” said Secretary of Finance, Administration and Information
Technology Preston L. Doerflinger said. “The precise amount of the deeper
reduction will be determined following the board meeting. It is also possible
the Legislature may take actions that could affect the revised reduction
amount.”
Due
to collection schedules, monthly gross production tax collections typically
reflect production levels and commodity prices from two months prior.
Therefore, January gross production tax collections reflect production and prices
from November, when oil fell below $45 per barrel, where it has remained since.
“The
truly bottom of the barrel oil prices that started in November are just now
hitting collections and will continue doing so for the next several months,” Doerflinger
said. “All tax categories are feeling the pain.”
In
addition to low oil prices, unexpectedly high wind production tax credit costs
have caused further revenue reductions. The $44.7 million cost for wind
incentives to date in FY 2016 is an approximately 83 percent increase over the
same period in FY 2015, which puts further strain on state revenue collections
already weakened by the effects of low oil prices.
The
increased cost of wind production tax credits was a large contributor to corporate
income tax refunds exceeding corporate income tax collections in October,
November and December. January marked the first month since October that the
state did not have to transfer monthly personal income tax collections to pay
monthly corporate income tax refunds.
“It
took until January to pay personal income tax back for the money that was
borrowed mostly to pay those wind tax credit claims that started in October,”
Doerflinger said.
Doerflinger
is director
of OMES, which issues the monthly GRF reports.
Major
tax categories in January contributed the following amounts to the GRF:
-
Total
income tax collections of $233.7 million were $58.5 million, or 20 percent,
below the estimate and $57.7 million, or 19.8 percent, below the prior
year.
Individual income tax collections of $219.4 million were $43.7 million, or
16.6 percent, below the estimate and $27.4 million, or 11.1 percent, below
the prior year.
Corporate income tax collections of $14.3 million were $14.8 million, or
51 percent, below the estimate and $30.3 million, or 68 percent, below the
prior year.
- Sales
tax collections of $164.6 million were $26.9 million, or 14 percent, below
the estimate and $20.9 million, or 11.3 percent, below the prior year.
-
Gross
production tax collections of $7.2 million were $17.7 million, or 71
percent, below the estimate and $23.2 million, or 76.2 percent, below the
prior year.
Natural gas collections of $6.7 million were $3.2 million, or 31.9
percent, below the estimate and $77,800, or 1.2 percent, above the prior
year.
Oil collections of $509,600 were $14.5 million, or 96.6 percent, below the
estimate and $23.2 million, or 97.9 percent, below the prior year.
- Motor
vehicle tax collections of $18.3 million were $4.6 million, or 20.1 percent,
below the estimate and $0.4 million, or 1.9 percent, below the prior year.
Other revenue collections of $83.8 million were
$2.2 million, or 2.7 percent, above the estimate and $4.1 million, or 5.1
percent, above the prior year.
Monthly revenue tables are available on the OMES website: https://www.ok.gov/OSF/News/January_2016_Financial_Report_Data_Tables_.html
Media Contact
JOHN ESTUS
Director of Public Affairs
(405) 521-3097 | john.estus@omes.ok.gov
 About the Office of Management and Enterprise Services
The Office of Management and Enterprise Services
provides financial, property, purchasing, human resources and
information technology services to all state agencies, and assists the
Governor’s Office on budgetary policy matters. Our mission: Supporting our partners through unified business services. For more information, visit OMES.OK.gov.
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