OKLAHOMA CITY — Sharply lower income tax receipts caused December deposits to the state’s general revenue fund to miss expectations by more than 12 percent, officials said Wednesday.
It was the ninth time in 2016 that general revenue receipts fell short of the target, and the 16th straight month of year-over-year declines.
The general revenue fund is the state’s primary operating account.
“The news is not as good as we might have hoped coming out of the holiday season,” said Office of Management and Enterprise Services Director and Finance Secretary Preston Doerflinger. “This will be a challenging time as we face a nearly $900 million budget hole and a necessity to find more recurring revenue sources. As I’ve said many times, we’re not going to cut our way out of this situation.”
General revenue for December totaled $419.6 million, which was 12.3 percent below the official estimate for the month and 9.3 percent below prior year collections.
For the first six months of fiscal year 2017, general revenue receipts are 2.7 percent below the estimate upon which the state budget is based, and 8 percent below prior year collections.
A revenue failure, triggering automatic spending cuts, occurs if general revenue for the budget year drops 5 percent below expectations.
“All state agencies have a responsibility to be diligent in monitoring all sources of revenue and adjusting their budgets and expenditures as needed,” Doerflinger said. “There will be some tough decisions to make as we continue to face dwindling revenue and a large budget hole.”
Individual income tax receipts, with sales taxes one of the state’s two major revenue sources, missed the target by 15 percent, while for the second straight month all of the much smaller corporate income tax revenue was returned to taxpayers in the form of refunds.
Sales tax revenue missed the mark by 4 percent and was 2 percent below prior year receipts.
Gross production receipts were up but still amounted to less than 4 percent of general revenue.
Motor vehicle tax receipts were down, as was revenue from remaining miscellaneous sources.