Oklahoma State House of Representatives
Fiscal Briefing
A brief summary of the state's current fiscal position
(based on initial revenue data for fiscal year 2009)

Fiscal Year 2008 Closes with Revenue Exceeding the Estimate

FY-08 ended with General Revenue Fund collections totaling $107.8 million over the estimate, resulting in a deposit to the state's Constitutional Reserve "Rainy Day" Fund for the fifth consecutive year while reaching the constitutional maximum balance for the third straight year.

• FY-08 General Revenue Fund collections totaled $5,953.2 million, $107.8 million over the certified estimate.
• A deposit of nearly $25 million was made to the Rainy Day Fund, bringing its balance to the constitutional maximum of $596.6 million. The increased balance will result in $447.4 million available for budget stabilization, if necessary and $149.2 million in emergency funds.

Fiscal Year 2009 Begins with Revenue Above the Prior Year and Estimate

July collections to the General Revenue Fund totaled $457.1 million, 11.2 percent above the same month of the prior year and over seven percent higher than the estimate. The one month data provide an indication that the state's economy is sound.

• Most major revenue sources experienced increases, including:
  • Individual income tax collections, 1.1 percent above last July and 9.6 percent above the estimate.
  • Corporate income taxes exceeded last July by 28.3 percent and the estimate by 19.5 percent.
  • Sales and use tax collections rose 7.6 percent above the prior year and were 1.5 percent ahead of the estimate, indicating positive consumer confidence and sustained disposable income.
  • Gross production tax revenue on natural gas increased 59.1 percent over last July and exceeded the estimate by 52.6 percent. Gross production tax collections on oil, apportioned to schools, counties and designated funds, more than doubled compared to last July.

Oklahoma's Economy Remains Strong Despite the National Situation

Led by record growth in the energy sector, healthy personal income gains and sustained consumer confidence, the state's economy remains solid even as much of the nation is experiencing difficulty. In addition, housing prices generally have been little affected by the sharp reductions experienced in many other areas of the nation as the Oklahoma market did not experience the unsustainable price run-ups that occurred in other states since 2002.

• While oil and natural gas prices recently came off their historic highs, the price environment remains beneficial to the state's energy industry. The Energy Information Administration of the U.S. Department of Energy currently forecasts oil prices (WTI) to average $119/barrel in 2008 and $124/barrel in 2009 with natural gas spot prices averaging $10.00/mcf in 2008 and $9.00/mcf in 2009.
• Personal income in Oklahoma has increased 6.7 percent from the first quarter of 2007 through the first quarter of 2008, compared to an increase of 4.8 percent nationally (Bureau of Economic Analysis).
• As housing prices plummet in numerous markets nationally, with the Standard and Poor's Price Shiller Composite Index falling nearly sixteen percent, Oklahoma Association of Realtors data indicate Oklahoma markets are generally holding steady, if not showing increases.

Despite national economic indicators in decline, the Oklahoma economy remains healthy, prompting Forbes magazine to declare Oklahoma City the most recession-proof city in the nation. While the outlook remains positive for the state in the short-term, with expected sustained economic growth, caution must be taken as the months pass. National economic weakness is likely to have some effect on the state and could affect overall growth at least in the short-term.

While facing continued reduction in federal dollars, efficient use of the taxpayer's money must remain of highest priority as we strive to make further investment in infrastructure improvements, educational excellence and accessible health care in the upcoming Legislative Session.