Larry OKC

11-17-2009, 10:05 AM

from the Mass Transit Announcement thread (I didn't want to hijack it and also can't recall where I had posted my concerns)

...I don't see how they can guarantee something as fluid and difficult to predict as sales tax. ...

Actually, according to the Mayor it is fairly easy for them to do. He said that with the MAPS for Kids tax they came within $2M of the revenue projections. With $520M raised with that tax, that means they only were off by 0.4%. I would say that is amazingly accurate, wouldn't you? I would be THRILLED if they could get their cost estimates anywhere near that percentage!

Over a long term it is fairly predictable. The problem with the Ford tax projection of $100M/year was it's relative short term of only 15 months.

I hereby retract any previous misgivings about the $100M/year average the MAPS 3 tax is projected to raise.

MAPS (MAPS and the 6 month extension)

5.5 years

$363M

$66M/year average

(the 6 month extension was projected to bring in $30M )

There was an approximate 2 1/2 year gap between MAPS & MAPS for Kids

MAPS 2

7 years

$520M

$74.29M/year

(11% increase here is probably attributable to MAPS, but have to take out what the normal increase would be due to inflation etc)

Ford Center (what I like to call MAPS 1.75)

15 months

$100M/year (est)

(this is a 25% jump over MAPS 2 collections?? Actual revenue to date is multi-millions below projections, don't have an exact figure but may be the similar 11% increase noted above or $82.46M/year)

MAPS 3

7.75 years

$777M

$100M/year (est)

(this is 46% higher than the yearly average for MAPS, and as noted above, 25% higher than the recently ended MAPS 2??)

Did some digging and found the out the following:

From the City’s 2009 FY budget report (available for download at OKC.gov)

“By year-end, it is expected that Sales Tax growth for FY 2009 will come in at 1.7%, compared with growth in the prior three years of 4.0%, 6.0% and 6.9%. To put these years in perspective, the 10-year average for sales tax growth is 4.3%”

My reading of that is a yearly sales tax growth average = 4.3%.

According to page 553 of the 09-10 Budget report, the Ford tax brought in $34.056M in the previous year and a projected $82.576 for a total of $116.63M (for 15 months) or $93.30M/year but as noted, collections are multi-millions below projections so, taking the presumed amount of the Ford tax of $82.46M and adding the 4.3% figure in for the next 8 years, should result in:

2010 = $64.51M*

2011 = $89.71M

2012 = $93.57M

2013 = $97.59M

2014 = $101.79M

2015 = $106.17M

2016 = $110.74M

2017 = $115.50M

TOTAL = $779.58M or $100.59M/year

That's almost exactly the City's $777M total ($100M/year) figure

*the amount for 2010 is lower because it won’t be a full year, that is the 9 month part of the 7 year and 9 month MAPS 3 tax. The following years amount is based on the total amount the tax should collect for the entire previous year.

...I don't see how they can guarantee something as fluid and difficult to predict as sales tax. ...

Actually, according to the Mayor it is fairly easy for them to do. He said that with the MAPS for Kids tax they came within $2M of the revenue projections. With $520M raised with that tax, that means they only were off by 0.4%. I would say that is amazingly accurate, wouldn't you? I would be THRILLED if they could get their cost estimates anywhere near that percentage!

Over a long term it is fairly predictable. The problem with the Ford tax projection of $100M/year was it's relative short term of only 15 months.

I hereby retract any previous misgivings about the $100M/year average the MAPS 3 tax is projected to raise.

MAPS (MAPS and the 6 month extension)

5.5 years

$363M

$66M/year average

(the 6 month extension was projected to bring in $30M )

There was an approximate 2 1/2 year gap between MAPS & MAPS for Kids

MAPS 2

7 years

$520M

$74.29M/year

(11% increase here is probably attributable to MAPS, but have to take out what the normal increase would be due to inflation etc)

Ford Center (what I like to call MAPS 1.75)

15 months

$100M/year (est)

(this is a 25% jump over MAPS 2 collections?? Actual revenue to date is multi-millions below projections, don't have an exact figure but may be the similar 11% increase noted above or $82.46M/year)

MAPS 3

7.75 years

$777M

$100M/year (est)

(this is 46% higher than the yearly average for MAPS, and as noted above, 25% higher than the recently ended MAPS 2??)

Did some digging and found the out the following:

From the City’s 2009 FY budget report (available for download at OKC.gov)

“By year-end, it is expected that Sales Tax growth for FY 2009 will come in at 1.7%, compared with growth in the prior three years of 4.0%, 6.0% and 6.9%. To put these years in perspective, the 10-year average for sales tax growth is 4.3%”

My reading of that is a yearly sales tax growth average = 4.3%.

According to page 553 of the 09-10 Budget report, the Ford tax brought in $34.056M in the previous year and a projected $82.576 for a total of $116.63M (for 15 months) or $93.30M/year but as noted, collections are multi-millions below projections so, taking the presumed amount of the Ford tax of $82.46M and adding the 4.3% figure in for the next 8 years, should result in:

2010 = $64.51M*

2011 = $89.71M

2012 = $93.57M

2013 = $97.59M

2014 = $101.79M

2015 = $106.17M

2016 = $110.74M

2017 = $115.50M

TOTAL = $779.58M or $100.59M/year

That's almost exactly the City's $777M total ($100M/year) figure

*the amount for 2010 is lower because it won’t be a full year, that is the 9 month part of the 7 year and 9 month MAPS 3 tax. The following years amount is based on the total amount the tax should collect for the entire previous year.