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Final FY 2020 revenues come in 10.2% below estimate

OMES logo

Steven Harpe
 Director

J. Kevin Stitt
Governor

-- NEWS RELEASE --

For Immediate Release

Aug. 13, 2020

Final FY 2020 revenues come in 10.2% below estimate

OKLAHOMA CITY General Revenue Fund collections in June were $564.9 million and came in at $163.9 million, or 22.5%, below the monthly estimate. This amount is $114.6 million, or 16.9%, below collections in June of 2019. Total collections for the 2020 fiscal year were $6.27 billion and came in at $716.1 million, or 10.2%, below the 2020 fiscal year estimate and $586.8 million, or 8.6%, below prior year collections.

“The final months of this fiscal year saw revenues fall at an unprecedented rate due to historically low oil and gas prices and the economic impact of COVID-19,” said OMES Director Steven Harpe. “However, thanks to the foresight of Governor Stitt and the state Legislature to put away additional savings, we were able use ​reserve funds to stabilize our state budget. Additionally, the state’s combined reserves ended up higher than originally anticipated, ​since the revenue shortfall was slightly less severe than projected in April and less reserve amounts ​were necessary to complete budgeted appropriations.”

After expending the 5% budget cushion, the final FY 20 revenue shortage was $366.6 million, or 5.2%, of the total budget, an improvement over the projected revenue failure of $416.9 million declared during April's BOE meeting. The revenue loss was filled by savings from the Rainy Day and Revenue Stabilization Funds.  

Record misses in the fourth quarter for individual and corporate income taxes were the result of the federal and state income tax filing extensions and a deferral option for 2019 state income tax payments and first quarter 2020 estimated tax payments. However, these deferred payments are expected to bolster the first quarter collections in FY 21.

Major tax categories in June contributed the following amounts to the GRF:

  • Total income tax collections of $242.2 million were $56.6 million, or 19.0%, below the estimate and $9.4 million, or 3.7%, below the prior year. Individual income tax collections of $216.6 million were $35.0 million, or 13.9%, below the estimate and $19.2 million, or 9.7%, above the prior year. Corporate income tax collections of $25.7 million were $21.7 million, or 45.8%, below the estimate and $28.6 million, or 52.7%, below the prior year.
  • Sales tax collections of $181.3 million were $31.5 million, or 14.8%, below the estimate and $3.9 million, or 2.1%, below the prior year.
  • Gross production tax collections of $13.7 million were $75.1 million, or 84.5%, below the estimate and $56.1 million, or 80.3%, below the prior year. Natural gas collections of $5.2 million were $20.4 million, or 79.8%, below the estimate and $17.8 million, or 77.5%, below the prior year. Oil collections of $8.6 million were $54.6 million, or 86.4%, below the estimate and $38.3 million, or 81.7%, below the prior year.
  • Motor vehicle tax collections of $17.1 million were $13.6 million, or 395.1%, above the estimate and $11.8 million, or 41.0%, below the prior year.
  • Other revenue collections of $110.5 million were $14.2 million, or 11.4%, below the estimate and $33.3 million, or 23.2%, below the prior year.

Collections to the GRF for the full fiscal year from major tax sources were:

  • Total income tax collections of $2.7 billion were $175.4 million, or 6.0%, below the estimate and $158.1 million, or 6.1%, above the prior year. Individual income tax collections of $2.5 billion were $217.7 million, or 8.0%, below the estimate and $161.7 million, or 6.9%, above the prior year. Corporate income tax collections of $238.3 million were $42.3 million, or 21.6%, above the estimate and $3.6 million, or 1.5%, below the prior year.
  • Sales tax collections of $2.1 billion were $195.7 million, or 8.8%, below the estimate and $116.6 million, or 5.5%, below the prior year.
  • Gross production tax collections of $469.8 million were $309.6 million, or 39.7%, below the estimate and $256.0 million, or 35.3%, below the prior year. Natural gas collections of $174.4 million were $237.8 million, or 57.7%, below the estimate and $20.4 million, or 79.8%, below the prior year. Oil collections of $295.4 million were $71.8 million, or 19.6%, below the estimate and $61.3 million, or 17.2%, below the prior year.
  • Motor vehicle tax collections of $52.4 million were $26.7 million, or 103.5%, above the estimate and $171.4 million, or 76.6%, below the prior year.
  • Other revenue collections of $981.3 million were $62.2 million, or 6.0%, below the estimate and $200.8 million, or 17.0%, below the prior year.

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 appropriated state budget. GRF collections are revenues that remain for the appropriated state budget after rebates, refunds, other mandatory apportionments and after sales and use taxes are remitted back to municipalities. In contrast, gross collections, reported by the State Treasurer, are all revenues remitted to the Oklahoma Tax Commission.  

Revenue tables can be viewed on the OMES website: https://omes.ok.gov/pages/june-2020-financial-data-tables

Note on Individual Income Tax and Motor Vehicle Collections: Every month of fiscal year 2020, contributions to the GRF from individual income tax collections and motor vehicle collections will be impacted by changes made by HB1014XX allocating specific motor vehicle and motor fuels tax collections to the ROADS fund and offsetting the distribution from this GR source by an equal amount. This new process will not directly impact revenues, but will cause anomalies in the prior year comparisons presenting as an increase in individual income tax and a decrease in motor vehicle contributions. Additionally, for the first year of these changes, we will experience a disrupted collection pattern in both sources when compared to estimated revenues.


Media Contact

Caden Cleveland
405-521-2213| [email protected]


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:  Provide excellent service, expert guidance and continuous improvement in support of our partners’ goals. For more information, visit OMES.OK.gov.