March GRF receipts beat estimate
Signals emerge of revenue slowdown related to low oil prices
OKLAHOMA CITY — While
General Revenue Fund (GRF) collections continued to perform above expectations
in March, signals emerged of the coming effect low oil prices may have on state
revenue collections.
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. GRF collections, reported by the Office of Management and
Enterprise Services (OMES), 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 prior
to rebates, refunds and mandatory apportionments.
March
GRF collections of $424.4 million were $11.1 million, or 2.7 percent, above the
official estimate upon which the fiscal year 2015 appropriated state budget is
based and $11.5 million, or 2.8 percent, above prior year collections.
Total
GRF collections for the first nine months of FY 2015 were $4.1 billion, which
is $82.6 million, or 2 percent, above the estimate and $216.7 million, or 5.6
percent, above the prior year.
“While this year’s revenues have been solid to date, we’re
seeing clearer signals now of a slowdown ahead,” said Secretary of Finance,
Administration and Information Technology Preston L. Doerflinger.
Preliminary
effects of sustained low oil prices are likely reflected in March gross
production tax collections, which missed the estimate by $22.6 million, or 62.8
percent, and were below prior year collections by $25.8 million, or 65.9
percent.
“Historically, energy downturns see gross production taxes fall
first and the other tax categories fall next. The gross production dip in March
reflects production from January, when the energy sector started contracting in
earnest, so other major tax categories may soon follow suit,” Doerflinger said.
Conversely, March personal income tax collections beat the
estimate by $46.2 million, or 60.9 percent, and were above prior year
collections by $35.6 million, or 41.3 percent. However, that increase may also
be a signal of future declines related to low oil prices.
“When a large economic sector shrinks, states often see individual
income tax collections temporarily go up due to severances and buyouts and then
turn down in the following months. It seems likely that March’s personal income
tax surge was fueled at least in part by energy sector severance paychecks and
buyouts, plus tax filing season trends,” Doerflinger said.
Doerflinger
is director of OMES, which issues the monthly GRF reports.
Major
tax categories in March contributed the following amounts to the GRF:
-
Total
income tax collections of $182.9 million
were $43.4 million, or 31.1 percent, above the estimate and $36.4 million,
or 24.8 percent, above the prior year.
Individual income tax collections of $122 million were $46.2 million, or 60.9
percent, above the estimate and $35.6 million, or 41.3 percent, above the
prior year.
Corporate income tax collections of $60.9 were $2.8 million, or 4.3
percent, below the estimate and $721,675, or 1.2 percent, above the prior
year.
-
Sales
tax collections of $150.8 million
were $8.6 million, or 5.4 percent, below the estimate and $2.8 million, or
1.8 percent, below the prior year.
-
Gross
production tax collections contributed $13.4 million to
the GRF in March and were made up entirely of oil tax collections. Lower
collections and offsetting refunds eliminated any deposit from natural gas
taxes.
Oil collections of $13.4 million were $7 million, or 34.3 percent, below
the estimate and $19.2 million, or 58.9 percent, below the prior
year.
-
Motor
vehicle tax collections of $15.5 million
were $1.1 million 7.7 percent, above the estimate and $807,146, or 5.5
percent, above the prior year.
-
Other
revenue collections of $61.8 million
were $2.2 million, or 3.5 percent, below the estimate and $3 million or 5
percent, above the prior year.
Monthly revenue tables are available on the OMES
website: http://www.ok.gov/OSF/News/March_2015_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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