GRF collections down 4.1 percent in first quarter
Federal uncertainty factors into state revenue declines
OKLAHOMA CITY — State General Revenue Fund (GRF) collections declined
6.6 percent in September from a year ago and are down 4.1 percent for the first
quarter of Fiscal Year 2014 from the first quarter of FY 13.
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 state budget. Made up of almost 70 revenue
sources, the GRF is where all taxes and fees flow that are not dedicated to
specific programs.
Total GRF collections for September were
$505.8 million, which is $36 million or 6.6 percent below collections from the
same month a year ago and $54.7 million or 9.8 percent below the estimate for
the year. Total GRF collections for the first quarter of FY 14 were $1.263
billion, which is $54.1 million or 4.1 percent less than the prior year and
$113.8 million or 8.3 percent below the official estimate upon which the FY 14
state budget is based.
“As anticipated, state revenues have softened
a bit. This is why we’ve been stressing not to anticipate a big pot of growth
revenue money this year,” said Secretary of Finance, Administration and
Information Technology Preston L. Doerflinger. “Ample time remains for
collections to pick up, but it’s looking like the state may see tighter
revenues than in recent years. Agencies should continue to keep their belts
tight, find efficiencies and prepare for potentially flat budgets.”
Collections from all four major tax
categories are running below official estimates for the first three months of
the fiscal year that started July 1. Gross production taxes are down 33.4
percent, followed by motor vehicle taxes at 13.6 percent, income taxes at 9.4
percent and sales taxes at 3.7 percent.
Current and future decreased revenue
collections are likely due to a combination of market uncertainties caused by
the federal government shutdown and other federal budget debates, an
anticipated softening of the state economy, and various noneconomic factors resulting
in temporary decreases in state revenue collections.
“A lot of this isn’t a surprise, but it’s
still cause for caution,” Doerflinger said. “The deadlock in Washington, D.C.
is a big concern. Oklahoma made a great run after the recession and now we’re
in an expected soft period that should pick back up soon provided D.C. doesn’t
drive everything into the ditch. Regardless of what happens this week, D.C.’s
recklessness has already done some damage here and across the nation, and
that’s a shame. We anticipate the more pronounced effects of the stalemate in
D.C. to be evident in next month’s revenue report.”
Noneconomic factors reducing state revenues
include the apportionment of $60 million in FY 14 income tax revenue to state
Capitol building repairs pursuant to legislation signed into law in May. The
first $20 million of that $60 million was apportioned in September and the
remaining $40 million will be apportioned by June 30, 2014, the end of the
fiscal year. The law requires another $60 million in income tax collections to
be allocated for state Capitol building repairs in FY 15.
“Looking forward, we’re still confident in
the Oklahoma economy’s proven resilience under the pro-growth policy climate
the Fallin administration has put in place. Low unemployment and continued
innovation within energy, manufacturing and other sectors of our economy will
continue to serve Oklahoma well in the months ahead,” Doerflinger said.
Doerflinger is director of the Office of
Management and Enterprise Services (OMES), which issues the monthly GRF
reports.
Major tax categories in September contributed
the following amounts to the GRF:
-
Income
tax – Individual and corporate
income tax collections of $256.3 million were $37.7 million or 12.8
percent less than prior year collections and $29.8 million or 10.4 percent
below the estimate.
Individual
income tax collections of $197.6 million were $9.4 million or 4.6 percent less
than the prior year and $4.3 million or 2.1 percent below the estimate.
Corporate income tax collections of $58.7 million were $28.2 million or 32.5
percent less than prior year collections and $25.5 million or 30.3 percent
below the estimate.
-
Sales
tax – The Tax Commission
apportionment of $160.3 million in sales taxes was $0.8 million or 0.5
percent more than the prior year and $8.2 million or 4.9 percent below the
estimate.
-
Gross
production tax – Gross
production tax collections contributed $10 million, entirely from natural
gas production. That amount was $8.3 million or 484.5 percent more than
prior year collections. The percentage jump is due to the fact that
monthly natural gas rebates last year ran about $4.7 million more than
this year. Even though natural gas prices have improved from a year ago,
collections from natural gas fell 29.9 percent below the monthly estimate
and are running 33.4 percent below the year-to-date estimate. No oil
production revenue was received and none was expected due to the statutory
direction of the first $150 million in oil production revenue to specified
funds, mostly for education.
-
Motor
vehicle taxes – Motor vehicle taxes of $15.5
million were $3.4 million or 17.9 percent less than prior year collections
and $4.2 million or 21.4 percent below the estimate.
-
Other
revenue – Other revenue collections of
$63.8 million were $4 million or 5.9 percent less than prior year
collections and $8.2 million or 11.4 percent below the estimate.
Monthly revenue tables are available on the
OMES website: http://www.ok.gov/OSF/News/September_2013_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: To lead, support, and serve. For more information, visit OMES.OK.gov.
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