Capitol Insider: Cuts Round Out Current Fiscal Year, Budget Hole Looms For Next Year

Feb 23, 2018

The Oklahoma State Senate has approved a bill to balance the books for the current fiscal year and close out the second special legislative session. The bill that originated in the House cuts the annual budgets of all state agencies by 0.66 percent. However, since the money will be cut only in the remaining four months, agencies will have to shed 1.9 percent of monthly budgets.

eCapitol’s Shawn Ashley reports Senate Minority Leader John Sparks, D-Norman, argued against the bill and urged lawmakers not to give up on passing a revenue-raising measure.


Sparks compared the latest revenue-raising package put to a House vote to a Christmas tree. "Sometimes you put a lot of ornaments on Christmas tree and it falls over." Sparks suggested smaller revenue-raising packages be considered. "Just because we are frustrated with the House doesn't mean we should give up," he said, adding, "A ‘yes’ vote is giving up."



Gov. Mary Fallin is expected to approved the bill next week, cutting nearly $45 million.

Fallin and state lawmakers also found out this week how much money is available for next fiscal year’s budget. The seven-member panel on the Oklahoma State Board of Equalization expects state revenues to increase. However, between outstanding obligations and available funds, a $167.8 million deficit is expected for next year’s budget.  


Full Transcript

Dick Pryor: This is Capitol Insider, your inside look at Oklahoma politics and policy. I'm Dick Pryor with the eCapitol news director Shawn Ashley. Hi, Shawn.

Shawn Ashley: Hi, Dick.

Pryor: State Board of Equalization has certified funds available for appropriation by the legislature for the next fiscal year. First, what is the Board of Equalization? And what did they do?

Ashley: The Board of Equalization was really created back in the 1980s as a result of the revenue problems that the state faced as a result of the oil bust. It's a seven-member board. They meet at least three times a year: once in December, once in February and again in June to certify how much money the legislature has to spend. These are the official numbers that lawmakers and the governor have to write the budget with.

Pryor: How much have they certified for fiscal year 19?

Ashley: They certified around $6 billion in terms of what is generally available for appropriations.

Pryor: Which means the state has a $167 million budget shortfall for next year. That's less than expected, though.

Ashley: Really, when you look at that number, what you're looking at is beyond what the board did. But it's some of the obligations that lawmakers will have to deal with as they write the FY-19 budget. The good news in what the board looked at, is that general revenue fund collections are expected to increase. And in terms of dollars available for appropriations, there is growth. But when you look at some of those obligations, like making up the money lost for the state’s medical schools, there is a $167 million shortfall.

Pryor: The Board of Equalization has also declared that money from the state's education lottery had been improperly used to offset cuts in education funding.

Ashley: That's correct. This is one of the other duties that the State Board of Equalization has, to look in and make sure that lottery money is being used to augment general appropriations to education, not simply replace funding for general education. And what they found was there was about $19.9 million in general appropriations reductions to common education, career tech and higher education that were offset with lottery money. Now the state legislature has to pay that money back.

Pryor: The legislature also has approved cuts to agencies in the current fiscal year to bail out three agencies that would have run out of money by around the first of May.

Ashley: This is the issue we've been talking about week after week, after week, going back to the [Oklahoma] Supreme Court's decision in August of 2017, when they found the tobacco cessation fee unconstitutional. Since that time, we've had two special sessions trying to raise additional revenue to offset the $215 million that was lost with that decision, which largely proved to be unsuccessful. So, now they're having to rebalance those agency budgets in order to provide money to the Oklahoma Health Care Authority, the Department of Human Services and the Department of Mental Health and Substance Abuse Services. What they are doing is transferring money from one agency to those three agencies in order to make sure they make it through the remainder of the fiscal year.

Pryor: The cuts appear small, but they occur over only about a four-month period, which actually makes them deeper.

Ashley: On an annualized basis, this is a $44.7 million cut which is about 0.66 percent. But because it's being implemented over the last four months of the fiscal year, it amounts to about 1.97 percent per month for the remainder of the fiscal year.

Pryor: Shawn, following the school shootings in Florida, there has been a robust national discussion on gun laws, mental health and school safety. What gun laws are on the table in the legislature this year?

Ashley: There's at least one bill still moving forward through the committee process, House Bill 2951 by Rep. Jeff Coody. What this bill does is implement essentially what's called “constitutional carry” in the state. If you're 21 years of age, you are able to purchase and carry, either concealed or unconcealed, a handgun in the state of Oklahoma. In other cases, you would also be able to carry or transport at least a rifle or a long gun. And then of course, there is the bill we've spoken about previously, related to extending the "stand your ground" law to places of worship, which is made it through committee and is still yet to be heard on the floors.

Pryor: What should we watch for over the next few days?

Ashley: March 1 is the deadline for bills to have made their way out of committee. Because the legislature missed essentially two days of work due to the weather, a lot of committee meetings, all the committee meetings, were canceled. So, those agendas will have to be carried forward and those bills, along with anything else that wants to make it through the legislative process, will have to be heard by that deadline.

Pryor: Thanks, Shawn.

Ashley: You're very welcome.

Pryor: That's Capitol Insider. Until next time, with Shawn Ashley, I'm Dick Pryor.

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