State tax collections are up, thanks to increased income and sales tax revenues. But finance officials are watching for “spillover” effects from steadily declining oil and natural gas revenues, State Treasurer Ken Miller said Tuesday.
May marked the six month in a row that gross production taxes from oil and natural gas were less than the same month a year ago.
“In the coming months, we will be keeping a close watch on natural gas and crude oil prices,” Miller says.
Revenues from natural gas — which is selling for near record lows because of overproduction and warm weather — have declined dramatically, Miller says in his monthly report on tax collections.
Natural gas extraction was responsible for more than half of Oklahoma’s gross production tax revenues in October 2011. By April 2012, that amount dropped to 32 percent, according to the report.
But state revenues, overall, are up. May 2012 collections increased 5.8 percent from the same month last year, which Miller says “compares to average growth over the past 12 months of 9.2 percent.”
Miller also pointed to the state’s low unemployment rate, which at 5.0 percent is more than three points lower than the national rate.
“Oklahoma City’s rate of 4.0 percent is the lowest of the nation’s 49 largest cities and speaks to the strength of the rebounding economy,” he says. “Reports show 38,500 more Oklahomans have jobs now than a year ago.”