When lawmakers prepare the state’s annual budget, the agencies that help put estimates together only provide information for the next fiscal year. A bill awaiting final confirmation in the Senate would require state agencies to produce three years of economic analysis for lawmakers to consider, The Journal Record’s Dale Denwalt reports:
The House author said that looking so far forward could lead to policy changes, either austerity measures or increased spending based on the outlook. State Rep. David Brumbaugh, R-Broken Arrow, said recent single-year budget analyses showed lawmakers the next years’ budget shortfalls. “We knew this as far back as 2014 that these revenues would be dropping – yet we spent $7.3 billion,” he said. “Even establishing something like an endowment would give us a softer landing.”
Oklahoma City University economist Russell Evans says some agencies would find use in budgeting that way. Denwalt writes Evans’ work estimating municipal sales tax collections tends to be less precise over time.
“One of the things I try to remind our audiences of is forecasting has two purposes,” he said. “One is the actual number, but the other is the forecast process itself, what sorts of changes in economic conditions are most likely to have an impact on the forecast.” For example, if there is a bump in the number of high school students, the university system could implement that figure in long-range plans. “That could be an important step in moving away from an incremental budget process and moving toward a priorities-based, strategic-based budget process,” said Evans. “You may have agencies whose needs are based on population demographics, and those demographics may be changing in one direction for a period of time, and their needs will be greater than a simple 3-percent or 5-percent increase.”
The Senate could either give final approval to the bill and send it to Gov. Mary Fallin’s desk, or send it back to the House for more work.
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