Doerflinger: You’re doin’ fine, Oklahoma
Published: September 12th, 2011
Individual income tax collections to Oklahoma’s General Revenue Fund rose sharply in August as total receipts returned to a double-digit growth rate, Office of State Finance Director Preston Doerflinger announced Monday (September 12).
The report is the latest in a series of revenue analyses by state officials concluding that in nearly every benchmark, Oklahoma is faring much better than most of the United States, and better than surrounding states in employment and other indices.
“Oklahoma’s economy remains a bright spot against a backdrop of economic uncertainty nationally and internationally,” said Doerflinger, secretary of finance. “This month’s report is certainly good news after state revenue growth moderated somewhat in July.”
Total revenue collections to the General Revenue Fund outpaced last year’s total for August by more than 18 percent and beat the estimate upon which the current state budget is based by more than 11 percent.
All major tax sources – income, sales, gross production and motor vehicle — surpassed last year’s collection rate, with income and motor vehicle taxes showing the biggest gains.
Receipts from the individual income tax soared by 38.9 percent in August over the same month last year, despite a rise in the seasonally adjusted state unemployment rate in July to 5.5 percent, from 5.4 percent in June.
“We’re still standing strong in unemployment, compared to a national jobless rate of 9.1 percent,” Doerflinger said. “In fact, our unemployment rate is lower than any surrounding state, with Arkansas, Colorado, Missouri and Texas recording jobless rates that exceeded 8 percent in the latest report from the U.S. Bureau of Labor Statistics. All this tells me we must be doing something right in Oklahoma.”
“You never want to make too much out of one month’s revenue figures in a single area, especially income taxes,” Doerflinger emphasized. “In this instance, part of the big jump in income taxes is tied to having a longer month for daily collections compared to August of 2010.
“But taking that into consideration, the scope of the increase and data from the Oklahoma Employment Security Commission persuades me to believe Oklahoma is adding good-paying jobs to our workforce in such areas as energy and manufacturing.”
Gov. Mary Fallin welcomed the news of the August GRF collections. “Despite the challenging national environment, Oklahoma’s economy continues to be growing at a steady pace,” the governor said. “Our pro-growth, pro-jobs policies are paying off. This month’s revenue report is one more indication that our state is on the right track.”
The latest Baker Hughes report showed the rotary rig count in the Oklahoma oil and natural gas fields increased by eight from the previous week to 203, which is a net gain of 65 rigs from the same period in 2010.
“As has been the case historically, the Oklahoma economy thrives when there is increased activity in the oil patch, leading to higher General Revenue Fund receipts,” Doerflinger said.
He added: “This is a bonus as we strive to broaden our economy. It’s worth noting that Oklahoma has added thousands of manufacturing jobs in the last year, even as those jobs have been evaporating for the nation as a whole.
“This is another indication that we are continuing to take the right steps to position Oklahoma as a leader on the national stage as our economy outperforms the vast majority of other states.”
Total collections to the General Revenue Fund for the first two months of fiscal year 2012 from all sources were $797.5 million. This total is $76.6 million or 10.6 percent more than was collected through August of the last fiscal year and $56.5 million or 7.6 percent more than estimated for current year-to-date collections.
August collections totaled $414.8 million, which is $64 million or 18.3 percent above the same month of the prior fiscal year and $41.8 million or 11.2 percent more than was estimated for the month. The strong collections in August came after growth in July was measured at 4 percent over the previous year.
The Office of State Finance is the agency that has generated GRF reports uninterrupted for decades, based on official figures from the Oklahoma Tax Commission after deductions for rebates and other adjustments.
The GRF reports are watched closely by state agencies, who receive monthly allocations from the fund to pay their bills.
General Revenue Fund collections for the major tax categories in August were:
Income taxes – The total collected from individual and corporate income taxes in the month of August was $161.6 million for the FY-2012 General Revenue Fund, which was $44.7 million or 38.3 percent more than prior year collections and $44.1 million or 37.6 percent above the estimate.
Individual income tax receipts of $161.6 million were $45.3 million and 38.9 percent above the prior year and $48.4 million or 42.7 percent above the estimate.
Corporate tax collections for August were zeroed out by larger than expected rebates, leaving no deposits for the General Revenue Fund.
Sales tax — Sales tax collections produced $145.3 million for the General Revenue Fund, $8.5 million or 6.2 percent more than the prior year and $0.8 million or 0.5 percent above the estimate.
Gross production tax — The August taxes on natural gas accounted for $36.1 million in General Revenue Fund receipts, which was $7.7 million or 27.1 percent above the prior year and $1.1 million or 3.0 percent below the estimate.
All gross production tax collections for the month were from the tax on natural gas. No collections were received from tax on gross production oil and none was expected because statutes require distributions to other funds before monies flow from this source to the General Revenue Fund.
Motor vehicle taxes — This tax source produced $19.9 million, which was $4.3 million or 27.9 percent above the prior year and $3.3 million or 19.6 percent above the estimate.
Other Revenue — Other revenue produced $51.9 million in August. This was $1.2 million or 2.3 percent below the prior year and $5.2 million or 9.1 percent below the estimate.