Office of State Finance - Revenue Collections FY End 2004

NEWS RELEASE

Tuesday, July 13, 2004
For immediate release

FY-04 GENERAL REVENUE FUND COLLECTIONS FINISH YEAR ABOVE PRIOR YEAR, ESTIMATE
More Than $200 Million Bound For Rainy Day Fund

(OKLAHOMA CITY) Oklahoma General Revenue Fund collections finished FY-04 10.0 percent above last year’s collections and 4.7 percent more than the fiscal year’s estimate, Office of State Finance officials reported today. This increase in revenues will allow the state’s first Rainy Day Fund deposit since the end of the 2001 fiscal year.

Preliminary reports show General Revenue Fund collections produced $4.605 billion for the 2004 fiscal year, which ended June 30. The collections were $418.4million or 10.0 percent more than the prior fiscal year and $208.8 million or 4.7 percent above the estimate approved by the Board of Equalization.

“After two years of declining revenues,” Scott Meacham, Director of the Office of State Finance, said, “it is very encouraging to see the fiscal year end with a deposit to the Rainy Day Fund. We estimate that the amount of the Rainy Day Fund deposit will be $208.8 million. For the past year, we have been operating with virtually no funds in reserve for an emergency. Now, we will be able to make a deposit to the Rainy Day Fund and have cash available to deal with any unforeseen circumstances that may arise.”

Deposits to the Constitutional Reserve or Rainy Day Fund are made at the end of the fiscal year when collections exceed the revenue estimate adopted by the Board of Equalization. The state last made a deposit to the fund at the conclusion of FY-01. Collections for FY-2004 surpassed the revenue estimate by $208.8 million, which will be deposited in the fund.

At the fiscal year’s end, each of the major tax sources had outperformed prior year collections, as well as the estimate.

“Our major revenue sources, such as corporate and individual income taxes and the state sales tax, continue to perform well,” Meacham said. “This is further evidence our state’s economy has rebounded from its low points over the prior two years and currently is growing.”

Income Taxes -- Net income taxes, a combination of individual and corporate income tax payments, yielded $2.0 billion for the General Revenue Fund in FY-04. That amount was $236.5 million or 12.6 percent above the prior year and $40.5 million or 1.9 percent above the estimate. Individual returns produced $2.0 billion, which was $183.6 million or 10.0 percent above the prior year and $25.0 million or 1.3 percent above the estimate. Corporate returns produced $102.8 million, an increase of $52.8 million or 105.7 percent from the prior year and $15.4 million or 17.7 percent above the estimate.

Sales Taxes -- The state’s number two revenue source, which is fueled by retail sales, produced $1.3 billion in FY-04. That was $83.9 million or 7.0 percent more than the prior year and $48.4 million or 3.9 percent above the estimate.

Gross Production Taxes -- This tax on natural gas production generated $443.7 million for the state’s General Revenue Fund, which was $78.0 million or 21.3 percent above the prior year’s collections and $85.0 million or 23.7 percent higher than the FY-04 estimate.

Motor Vehicle Taxes -- This revenue source, which is based on motor vehicle license sales, produced $222.0 million in FY-04. That amount was $25.6 million or 13.0 percent more than the prior year and $7.8 million or 3.6 percent above the estimate.

Other Revenue -- Other revenue, which includes a wide range of receipts such as cigarettes, liquor, insurance and inheritance taxes, interest and investments, yielded $635.1 million during the fiscal year just concluded. That was $97.1 million or 18.1 percent more than the prior year and $27.1 million or 5.4 percent more than the estimate.

Looking at the month of June, the last month of the FY-04 fiscal year, preliminary reports show General Revenue Fund collections totaled $425.5 million. That amount was:

$0.6 million or 0.2 percent less than the prior year; and
$9.9 million or 2.4 percent above the estimate.

Income taxes -- This source yielded $225.4 million to the FY-04 General Revenue Fund, which was $19.1 million or 9.3 percent above the prior year and $11.6 million or 5.4 percent above the estimate. Individual returns produced $202.6 million, which was $15.3 million or 8.1 percent above the prior year and $5.1 million or 2.6 percent above the estimate. Corporate returns produced $22.8 million, which was $3.8 million or 20.2 percent above the prior year and $6.5 million or 39.5 percent above the estimate.

Sales tax -- This source produced $106.7 million for general revenue in June, up $0.1 million from the prior year but $1.0 million or 0.9 percent below the estimate.

Gross production tax -- This tax accounted for $38.4 million for general revenue in June, which was $2.6 million or 7.4 percent above the prior year and $6.5 million or 20.4 percent above the estimate.

Motor vehicle taxes -- In June, this source produced $21.4 million, which was $7.3 million or 51.3 percent above the prior year and $3.1 million or 16.8 percent above the estimate.

Other Revenue -- Other revenue produced $33.6 million in the final month of the 2004 fiscal year. This was $29.7 million or 46.9 percent below the prior year and $10.3 or 23.4 percent below the estimate.