DALLAS — Oklahoma in fiscal 2010 experienced the worst revenue decline since the Great Depression, but Treasurer Scott Meacham is encouraged by the latest report on state tax collections.
“While the global recession hit Oklahoma very hard during the recently completed fiscal year, all signs point toward better times ahead,” he said at a news conference on Tuesday as he unveiled the July revenue report.
General fund revenues in fiscal 2010 totaled $4.6 billion, which was $945 million less than in fiscal 2009 and $816 million less than expected when last year’s budget was developed.
Meacham said revenue collections in June, the last month of fiscal 2010, totaled $477.4 million, which was $10 million more than in June 2009 but $35 million less than expected.
“From the budget standpoint, the worst is behind us,” Meacham said. “This should be the worst year we will ever see.
“This has been a once-in-a-lifetime experience.”
Meacham said he expected growth in state revenues to be slow throughout fiscal 2011. State agencies that saw reduced budgets over the past year should not expect those cuts to be restored soon, he said.
“Agencies need to be prepared that the cuts are going to be more or less permanent,” Meacham said.
The revenue collections began faltering in the last six months of fiscal 2009, Meacham said. The slump continued through the first six months of fiscal 2010 before beginning to ease somewhat.
“We felt the recession the most during the fiscal year’s first six months,” he said. “After December, we started to see improvements, which continued through this month, especially in gross production, sales, and motor vehicle tax collections.”
The state ended fiscal 2010 with a surplus of $167.7 million. Meacham said $120 million would go into a special cash fund with $47.7 million remaining in a cash-flow reserve fund used to balance the budget on a monthly basis.
Net income tax collections in fiscal 2010 totaled $1.86 billion, down $403.4 million from fiscal 2009 and $475.5 million less than expected.
The sales tax generated $1.52 billion last year, down $131 million from fiscal 2009 and $238 million less than expected.
The state budget for fiscal 2011 totals $6.7 billion, down $518 million from the original fiscal 2010 budget and $254 million less than actual expenditures after several months of 10% reduction in agency budgets due to reduced revenues.
The current state budget was balanced with $373 million from the rainy day fund, $539 million in federal stimulus funds, and $450 million of enhancements, including deferred tax breaks, refinancing of some state bonds, and fee and permit increases.
Oklahoma is rated Aa2 by Moody’s Investors Service and AA-plus by Standard & Poor’s and Fitch Ratings.