Total Revenues of Oklahoma Governments
Revenue is the money collected by governments. Government cannot provide services we expect without money to pay employees, hire contractors, enter intro contracts, build facilities and infrastructure, and make direct payments to people in need. Since state and local governments cannot operate at a deficit (spending more than they take in), the decisions we make about how to collect money have a direct effect on what public services we get. They also affect who shares in the effort of providing public service and how economic decisions are made. This section describes the taxes and other revenue sources of Oklahoma’s governments.
State and local governments rely on a wide range of revenues to finance services. When we think of government revenue we usually think of taxes, but they are far from the only important revenue. Services that benefit all citizens are financed at least partly from taxes. Most services, though, are funded at least in part through other revenue sources, including federal funds, insurance trust revenues for retirement and insurance systems, fees or user charges, and utility charges. Each government and each service is financed differently. The mix of revenue depends on service demands, citizens’ desired level of taxes, and whether governments provide services that can be funded through federal grants, user charges, or other generated revenue. The mix of revenue changes over time based on dozens of policy decisions made each year at the state, federal and local levels.
Overall, state government collected $26.3 billion in 2013, while local governments collected $13.6 billion. The figure includes over $4 billion in state and federal aid that the state passes on to local governments, mainly for education.
This graph shows the per person breakdown of different revenue sources to Oklahoma State and local governments. Our state receives $9,326 per person in revenue, which is about 14 percent less than the national average. State snd local government brings in less revenue from taxes, user charges, insurance trusts and utilities than the national average, but more in intergovernmental transfers and other revenues.
Both levels of government rely on a broad range of different revenue sources, though local governments are more dependent on taxes, user charges, and utilities.
- Taxes are the largest source of revenue for state government and second for local governments. The state collected $8.9 billion in taxes and local governments raised $4.6 billion in 2013.
- Intergovernmental revenues are important to both levels of government, with the state receiving over $7 billion and local governments about $4 billion. Intergovernmental revenues to the state come from the federal government, while local intergovernmental revenues include funding from both the state (about 90 percent) and federal government (about 10 percent).
- State and local governments collected $2.4 billion each in user charges-fees paid by people and businesses who benefit directly from a service-in 2013.
- Insurance trusts, which collect payments for unemployment insurance, workers compensation, and employee retirement systems, are an important source to state government, which collected nearly 5 billion for this purpose. Local insurance trusts are limited to retirement systems, which collected $168 million in 2013.
- Utility revenues are charges to customers of water, electric, gas, and public transit systems. They are somewhat more important to local governments, which use these fees to pay all costs of the utility and often to help fund other public services. Oklahoma governments collected $2.0 billion from this source in 2013.
Other revenues include interest, sale of property, fines, and various licenses and permits. These generated $2.3 billion for the state government and about $700 million for local governments in 2013.