Budget surplus projections for tax rebates may have overstated

Saturday, June 18th 2005, 12:21 pm

By: News On 6

OKLAHOMA CITY (AP) _ Budget surplus projections may have been overstated, so income tax rebate checks may be less than estimated, the chairman of the House Appropriations and Budget Committee said Friday.

Officials have estimated that the state could end this fiscal year on June 30 with about $220 million in surplus money.

But Chris Benge, R-Tulsa, said House analysts think a better estimate is $130 million.

Rebates that Gov. Brad Henry supported as part of a compromise tax-relief program in the regular legislative session will be lower if surplus revenue turns out to be lower.

``Instead of a $100 rebate, the average couple may be getting around $65,'' he said.

Benge's new projection comes days before the state Board of Equalization meets Monday to certify funds available for appropriation based on expected tax collections.

He recommended that lawmakers be careful when considering other funding issues when they return in special session. Legislators shouldn't come back until final figures for this fiscal year are known, he said.

``We need to let the fiscal year finish out before we look at any further spending,'' Benge said. ``My concern is we may be overextending ourselves.''

Legislators approved a plan to use half the surplus _ about $100 million _ for rebates of as much as $100 per filing taxpayer this calendar year. The other half is to go to a budget stabilization and economic development fund.

State Treasurer Scott Meacham said it might be August before state officials know the amount of excess funds.

``When the Office of State Finance was saying it may be as high as $200 million, that was with six months to go in the fiscal year,'' he said. ``They were just making their best guess based on how the rates of revenue were coming in at that time.

``I think that the taxpayers in Oklahoma will be just as happy to get $65 or $100 rebate.''

Meacham reported this week that year-to-date collections total $336.5 million over state estimates, meaning the state will make the maximum allowable deposit into the state's Rainy Day Fund.

The fund has about $217.5 million. The constitutional limit on the Rainy Day Fund deposit this fiscal year is an additional $243.8 million for a total of $461.3 million, or 10 percent of the prior year certified general fund collections.

``The point that he's missing is we're going to max out our Rainy Day Fund for the first time ever, period,'' Meacham said of Benge. ``We have never maxed out the Rainy Day Fund before, and over and above that, we're going to generate, no matter whether it's his number or what number, well in excess of $100 million in excess over what we used to fill the Rainy Day Fund up.''

Benge said the House staff's estimate of $130 million in excess funds assumes collections continue to run ahead of projections by 8 percent. Collections in May were 2.4 percent above the estimate, while collections in April were 11.5 percent above the estimate. March collections were 10.5 percent above estimates.

Henry spokesman Paul Sund questioned whether the talk about rebates is a ploy to oppose funding for Oklahoma centennial projects to celebrate the state's first 100 years in 2007. Henry has called for a special session to consider money for both the centennial and corrections.

``Leaders around the state have worked tirelessly to raise both private and public funds for a vibrant centennial celebration,'' Sund said. ``We would hope Rep. Benge would share their vision and leadership on this issue and seek to provide solutions rather than excuses.''

No date has been set for lawmakers to return this summer.