It’s not looking good for Oklahoma’s budget. The state finance secretary says a revenue failure is all but certain.
The state budget has a 5 percent cushion built in, which prevents cuts to appropriations if revenues are below the official estimate. But Finance Secretary Preston Doerflinger’s office says the Board of Equalization will look at a revenue forecast Monday nearly 8 percent below the estimate it approved in June.
If the board approves it, Doerflinger will declare Oklahoma’s first revenue failure since 2009. That will mean midyear cuts for state agencies.
Doerflinger blames low oil prices for the looming revenue failure and singled out the Organization of the Petroleum Exporting Countries as the culprit.
"Tax revenues in energy states are collateral damage in the market warfare OPEC is waging on U.S. energy producers," Doerflinger said. "As tempting as it may be to send OPEC and Saudi princes a $900 million bill, we can’t do that and have to manage this hole realistically and responsibly with the tools at our disposal."
State officials currently estimate next year’s budget hole will be almost $901 million.
A news release from Doerflinger's office broke down the amounts different tax categories contributed to Oklahoma's general revenue fund, or GRF.
Total income tax collections of $110.4 million were $16.9 million, or 13.3 percent, below the estimate and $10.5 million, or 8.7 percent, below the prior year.
Individual income tax collections of $110.4 million were $16.6 million, or 13.1 percent, below the estimate and $10.5 million, or 8.7 percent, below the prior year.
Corporate income tax collections were entirely consumed by refunds and contributed nothing to the GRF.
Sales tax collections of $160.5 million were $19.9 million, or 11.1 percent, below the estimate and $13.6 million, or 7.8 percent, below the prior year.
Gross production tax collections of $8.9 million were $16.9 million, or 65.6 percent, below the estimate and $14.7 million, or 62.4 percent, below the prior year.
Natural gas collections of $8.6 million were $10.5 million, or 54.9 percent, below the estimate and $615,900, or 7.7 percent, above the prior year.
Oil collections of $287,306 were $6.4 million, or 95.7 percent, below the estimate and $15.3 million, or 98.2 percent, below the prior year.
Motor vehicle tax collections of $14.4 million were $83,473, or 0.6 percent, below the estimate and $10.7 million, or 290.5 percent, above the prior year.
Other revenue collections of $59.9 million were $3.7 million, or 6.6 percent, above the estimate and $307,859, or 0.5 percent, below the prior year.
