DALLAS - Texas sales tax revenues fell for the first time in 62 months in June, reflecting the oil and gas industry's downturn in the state, according to Comptroller Glenn Hegar.
Revenues fell 1.4% compared to June 2014, Hegar said.
Though characterizing the drop as a "slight," Hegar acknowledged that the July 8 report showed the first downturn in more than five years.
"This slight decline was expected due to the slowdown in the oil and gas mining sector, and is in line with the biennial revenue estimate presented in January," Hegar said.
"Receipts from the construction, information, restaurant and services sectors continued to grow, however, which is a testament to Texas' diverse and dynamic economy."
Despite the drop in overall revenues, the $609.8 million that will be distributed to local governments actually increased by 1.2%, Hegar said.
Oil and gas production and refining are credited with causing the "Texas Miracle," that allowed the Lone Star State's economy to grow dramatically after the 2008 recession. Most of the new U.S. jobs since 2008 were created in Texas, former Gov. Rick Perry frequently boasted. Perry, who left office this year, is running for president.
A number of oil and gas companies, including Houston-based operator Hercules Offshore have filed or announced plans to seek Chapter 11 bankruptcy as prices of West Texas Intermediate Crude remain about 50% below their 2014 peak.
In April, Texas lost 8,300 oil and gas jobs, the biggest decline in six years.
Still, the state added a modest 1,200 seasonally adjusted jobs in April, rebounding from a loss of 25,200 job losses in March, according to data from the Texas Workforce Commission.
In May, the state gained 33,200 seasonally adjusted nonfarm jobs, bringing the over-the-year total to 286,400 jobs added.
The state's seasonally adjusted unemployment rate increased in May to 4.3% from 4.2% in April. The state continues to trend below the U.S. unemployment rate of 5.5%.
In a July 2 report, Dallas-based Comerica Bank reported that its Texas Economic Activity Index eased again in April, decreasing 2.7 percentage points to a level of 98.5. April's reading is 26 points, or 36 percent, above the index cyclical low of 72.9. The index averaged 105.1 points for all of 2014, four and four-fifths points above the average for full-year 2013. March's index reading was 101.2.
"The Texas economy continues to feel the pull from lower oil prices," said Robert Dye, chief economist at Comerica. "Our Texas Economic Activity Index has now declined for six consecutive months, beginning in November of 2014. Concerns about ongoing strong global production and floating storage may weigh on prices this summer."
