Oh ... my ... God ... actual oil tax revenues .... fell ..... more ... than .... $40 million .... short ... of ... projections.
Batten down the hatches! Close the borders! Shut down the schools! Raise property taxes! North Dakota is short $40 million from what was projected! OMG. The sky is falling, the sky is falling!
But wait! Wait, I say! Last year, one year ago, the same folks missed estimates in the other direction. By how much? You ask. $40 million? $50 million? $100 million. Not even close.
One year ago, seven years into the boom, this was posted:
North Dakota awash in oil royalties -- collecting way more than forecast. The Dickinson Press is reporting:Okay, so back to the most recent project: estimates were off by $40 million. Exactly how much is that in terms of a percentage? 50%? 60% 80%.
North Dakota is poised to collect nearly $9.8 billion in oil tax revenue during the next two years and $2.2 billion more than previously forecast for 2013-15, according to a new outlook released Friday that had elected leaders calling for additional tax relief, greater funding for western counties and more accurate forecasts.The preliminary forecast from the state Office of Management and Budget assumes that oil production will grow to 1.3 million barrels per day by the end of the current biennium on June 30, 2015, and to 1.4 million barrels per day by the end of the 2015-2017 budget cycle, OMB Director Pam Sharp said.Gov. Jack Dalrymple noted that the revised projection for 2013-15 shows general fund revenues of $4.88 billion, or about $285 million more than the legislative forecast prepared in February 2013.The general fund, which covers the general operations of state government, is projected to end the biennium with a balance of $614 million – eight times higher than the $80 million projected in the legislative forecast and $157 million more than an update Sharp presented to state lawmakers in March.
Way, way off. 20%? 10%?
Still way off.
$42 million represents 3.9% of overall general fund tax revenues, or something like that.
I may have this all wrong, and I may be comparing apples and oranges and I may be confusing oil revenue and tax revenue and whatever else, but the point is this:
- when I saw $40 million, it got my attention
- when I saw it represented less than 5% of projections, I said, "you gotta be kidding"
- remember, projections are just that; hopefully the legislators didn't budget on "high-side" projections
- hopefully, the legislators budgeted on "low-side" projections
- last year, the projection was to collect billions more than forecast
- it takes one thousand stacks of one-million stacks to reach a billion (if that makes sense); take away 42 of those stacks and one still has 958 stacks of million-dollar stacks
Sometimes I just want to scream.
This was done quickly. There will be factual and typographical errors. I will post it as is, and come back to it later.
But somehow I think Chicago, Volkswagen, and Greece have significantly greater problems than North Dakota despite coming up $42 million short. Maybe North Dakota can keep some of the public schools open.