Recession hits Oklahoma’s revenues, shortfall probable in new year

From CapitolBeatOK Staff Report

Oklahoma’s fiscal year has ended with evidence the state’s revenues are being deeply impacted by the nationwide recession, State Treasurer Scott Meacham announced last week.

In a release to The City Sentinel, Meacham said June collections were sufficient to fund appropriated obligations for July, the first month of the new fiscal year, but action may be required in coming months.

“It appears very likely at this point that Fiscal Year 2010 revenues will be less than originally estimated by the tax commission. That means a revenue shortfall is probable,” he said. “I will be meeting with state finance officials and Governor Henry to determine if it will be necessary to begin reducing allocations to state agencies to meet the anticipated revenue shortfall.”

Preliminary reports show general revenue fund collections for Fiscal Year 2009 that ended June 30 totaled $5.519 billion. That amount was: $434.7 million or 7.3 percent below the prior year; and $427.8 million or 7.2 percent below the estimate.

The recession started significantly impacting Oklahoma during the last half of the fiscal year, Meacham said. During the first half of the fiscal year, July through December, collections exceeded the estimate by $189.5 million or 6.6 percent. During the final six months, January through June, collections were below the estimate by $617.3 million or 20.1 percent.

The slowdown is seen in every revenue source, he said. Gross production taxes on oil and natural gas yielded $718.5 million for the year, which was $106.7 million or 12.9 percent below prior year collections and $41.8 million or 5.5 percent below the estimate. In June, this source generated $13 million, which is $91.7 million or 87.6 percent below the prior year and $57.8 million or 81.7 percent below the estimate.

Preliminary reports for collections in the month of June, the last month of the fiscal year, show General Revenue Fund collections totaled $441.2 million. That amount is  $190.3 million or 30.1 percent below the prior year; and $156.7 million or 26.2 percent below the estimate.