Oklahoma City officials attribute sales tax boost to spring storms

The city found out earlier this month that August sales tax revenue will be 15 percent above last year and 12.6 percent more than expected. The city has enjoyed modest improvement in sales tax revenue over the past few months after more than a year of tanking revenues that led to 12 percent reductions in most city departments for fiscal year 2010-11.

August sales tax revenue includes actual sales tax collections for the second half of June and estimated collections for the first half of July.

Budget Director Craig Freeman said city officials have analyzed the numbers and found a possible explanation for the jump in revenue.

"What we've seen is a significant increase in several areas like building materials, restaurants, hotels and the purchase of auto parts," Freeman said. "Those all sound related to the spring storms."

Freeman said damage caused by tornadoes, flooding and hail likely led to insurance payouts that city businesses and residents are now using to rebuild. Those sales could have caused an increase in sales tax. He said the city also saw some increased revenue related to the construction of the Devon tower downtown.

Freeman and City Manager Jim Couch have encouraged the city council to be cautious about future budget prospects and not to expect the city's revenue problems are over.

"You would think that as insurance checks come out that would carry over for a couple of months," Freeman said. "But the reality is that's not something that is going to be a continuing trend or something that we are going to build upon next year."

The city cut 100 jobs and supplemented the budget with MAPS 3 use tax revenue and reserve funds to keep from making deeper cuts, Couch said.

"We had about a $19 million gap that we had to fill this budget year," Couch said. "About $10 million or $11 million of that we filled with one-time money. The rest we filled with the positions we eliminated. We have to fill that gap again this year just to break even