Oklahoma state budget

1 Fiscal Year 2013 State Budget
2 Fiscal Year 2012 State Budget
3 Fiscal Year 2011 State Budget
4 Budget Transparency
- 4.1 Government tools
  - 4.1.1 Limitations and Suggestions
- 4.2 Summary of FY 2011 Balanced Budget
5 Accounting Principles
6 Stimulus
7 Public Employees
8 External links
9 Additional reading
10 References


Oklahoma
Annual
Fiscal Year	2012
Signed into law	May 24, 2011
GF Revenue

Oklahoma's $6.4 billion^[1] state FY2012 budget was signed into law by the governor on May 24, 2011.^[2] The FY2012 budget is 3.2 percent less than the $6.7 billion FY2011 budget.^[3]

Oklahoma has a total state debt of approximately $36,952,387,000 when calculated by adding the total of outstanding official debt, pension and other post-employment benefits (OPEB) liabilities, Unemployment Trust Fund loans, and the budget gap. ^[4]

See also: The Oklahoma State Budget on State Budget Solutions

2011 State spending & deficit in billions^[5]
Total spending	Health care	Education	Protection	Transport	Human services	Gen government
$6.7	$1.1	$3.6	$.65	$.2	$.69	$.46

2011 Local spending & deficit in billions^[6]
Total spending	Pension	Health care	Education	Welfare	Protection	Transport	Deficit
$16.9	$0.1	$1	$6.6	$0.3	$1.3	$1.2	$9.8

[edit] Fiscal Year 2013 State Budget

State Treasurer Ken Miller said on Nov. 3, 2011, that, despite rising state revenues, legislators face challenges in drafting the FY2013 budget. Those challenges include dealing with one-time funds used to plug holes in the FY2012 budget and the expiration of some tax credits. ^[7] Then in Dec. 2011, state Finance Director Preston Doerflinger said that lawmakers should have $6.5 billion available for the FY2013 budget.

Gov. Mary Fallin explained that although the state has seen an increase in revenues, she expects that the FY2013 budget will be relatively flat budget because the state must make up for the loss of one-time funds, including those from the federal government. The budget estimate includes the loss of $36 million for FY2013 when a dozen tax credits that were suspended the past two years are expected to resume July 1 and that the state must repay $50 million a year in energy rebates that were not paid out the past two years to oil and natural gas companies to help Oklahoma get through its budget crisis. The estimates also include the loss of about $70 million in revenue when the state personal income tax's top rate drops from 5.5 to 5.25 percent, effective Jan. 1.^[8]

'Legislative Proposed Budget

On May 21, 2012, lawmakers and the governor reached a deal on the $6.8 FY2013 budget. The budget spends approximately $200 million more than legislators were told in February by budget officials that they would have available to spend as a result of federal funds and extra available cash. The budget for FY2013 is 3.2% more than the FY2012 budget of $6.6 million.^[9]

The budget keeps spending for most agencies the same as FY2012, with the exception of Human Service and education, which will see increases.^[9] Increases include: • State Education Department: $52.4 million; • CareerTech: $1.4 million for operations; • Higher Education: $10 million for operations; • Transportation Department: $99 million to repay a transfer of funds this fiscal year; • Department of Human Services: $25 million.^[9]

Governor's Proposed Budget

Gov. Fallin presented her proposed FY2013 state budget to the legislature when it began its session on Feb. 6, 2011. Gov. Fallin's proposed budget can be foud here.

Spending

The governor's proposed FY2013 budget spends nearly $6.6 billion, up $124.7 million from the $6.5 billion FY2012 budget. Most agency budgets would remain the same as the current year. Under the budget, the Department of Mental Health and Substance Abuse Services budget would increase $143 million, a 76.4 percent increase, and the Oklahoma Health Care Authority's budget would decrease by $146.7 million, almost 15 percent.^[10]

Income Tax Cuts

She proposed reducing state income tax rates, including reducing highest rate of 5.25% down to 3.5% and reducing the income tax brackets, from seven down to three. Personal income taxes bring in about one-third of the state's legislative-appropriated budget. For this fiscal year, personal income taxes are estimated to bring in $1.9 billion of the $6.4 billion budget. The governor said that she would pay for the tax reduction by eliminating tax loopholes, carve-outs and other exceptions, but did not specify which ones.^[11]

[edit] Fiscal Year 2012 State Budget

See past state budgets

The FY2012 budget bill can be found here. The governor signed it into law on May 24, 2011.^[12]

As of October 2011, state revenue collections had risen for 20 months in a row, with collections for the past 12 months up almost 9 percent from the prior 12 months. State Treasurer Ken Miller said that Oklahoma regained almost 60 percent of the revenue that disappeared during the recession.^[13]

The legislature directed the Department of Central Services to assemble a list of all state-owned property and identify the "most underutilized state properties" of the state's 9,000 properties. Lawmakers have proposed selling some of the properties and use the revenue from the sales to help fund basic infrastructure needs.^[14]

To balance this fiscal year's budget, lawmakers and the governor used $357 million in special cash appropriations and $113 million in federal stimulus funds designated for the state's Medicaid program.^[8]

Personal income taxes bring in about one-third of the state's legislative-appropriated budget. In FY2012, personal income taxes are estimated to generate $1.9 billion of the $6.4 billion budget.^[15]

[edit] Legislative Proposed Budget

The legislature approved a $6.5 billion state budget^[16] when the House approved a key piece on May 13, 2011, and sent it to the Senate. The budget cuts cuts $238 million from state appropriations,^[17] trimming funding for most state agencies from between less than 1 percent to 9 percent. The FY2012 budget is 3.2 percent less than the $6.7 billion FY2011 budget.^[18]

Legislators had been approved to spend $6.3 billion based on revenue projections by the Oklahoma Tax Commission. To address a lawmakers plugged a $500 million shortfall, lawmakers turned to $120 million in cash flow reserves and also used money from a $70 million transportation bond issue, revenue from state agency revolving funds and remaining stimulus funds.^[16]

Budget Cuts^[17]

State finance office was cut by $1.4 million
Department of Consumer Credit will lose more than $200,000, of its $535,000 appropriation
Oklahoma Health Care Authority was cut by $9.9 million, about 1 percent of the authority’s appropriations
The prison system will lose $2.3 million
Education-related funding will lose $167.4 million

Funding Increases^[17]

The Attorney General's Office will receive an 8.3 percent increase in its appropriation
Department of Central Services will see funding increase by 8.4 percent, or $1.3 million, due in part to moving the Oklahoma Supreme Court from the Capitol across the street to the Wiley Post Building and the replacement of a $479,000 boiler in one of the state office buildings.
The Corporation Commission will see an additional $1.2 million because it was losing $2 million in federal funding because of its inability to enforce certain regulations and also because it needed to be compensated for an inadvertent “double cut” imposed on its budget several years ago.

[edit] Collective Bargaining Issue

On Feb. 23, 2011, the House General Government Committee, which is controlled by Republicas, approved HB 1576, which would repeal the Municipal Employees Collective Bargaining Act, which required cities with populations greater than 35,000 to collectively bargain with their workers.^[19] The new bill, which now goes before the full House, would end collective bargaining by municipal workers in the state's 13 largest cities.^[20]

[edit] Budget Cuts

Gov. Mary Fallin recommend on Feb. 3, 2011, 3% cuts in the state's next budget for priority areas and 5% for other agencies.^[21] Previously, Sen. David Myers, the new head of the Senate Appropriations Committee, told agency heads on Jan. 13, 2011, to prepare for funding cuts of up to 10 percent and directed them to produce plans on how to make the reductions.^[22]

Significant budget cuts are expected to come from education, which accounts for more than 50% of state funding.^[22] Passage of SQ 744 would require the state to raise to raise its per-pupil expenditure to the average of surrounding states, which could cost the state about $392 million in the 2012 fiscal year.^[23]

Gov. Fallin said she will not halt an automatic 0.25% reduction in the state's top income tax rate effective Jan. 1, 2012, a tax cut would reduce revenues by $120 million a year.^[22]

[edit] Fiscal Year 2011 State Budget

Find the state’s FY2011 Comprehensive Annual Financial Report (CAFR) compiled by the state government here.

Gov. Henry and legislative leaders reached a budget deal with just days remaining in the legislative session and with later cuts the budget ended up at $6.9 billion, which was $400 million less than the budget for FY2010.^[24]^[23]

At the end of the fiscal year, the state deposited $249 million into its Rainy Day Fund, which was $30 million more than estimated. ^[25]

[edit] Rainy Day Fund

As of Jan. 23, 2011, the state's Rainy Day Fund had a balanced of $2.03. One year prior to that, it contained $596.6 million.^[26] Because limits are placed on how much money can be withdrawn, lawmakers during the last session withdrew $100 million from the Rainy Day Fund and put it in an account so it would be available for the session starting Feb. 7, 2011.^[26]

[edit] Revenue Issues

Oklahoma faces challenges to its plans to raise revenue in FY2011.

A report released by the Oklahoma Policy Institute in December 7, 2010, predicts that the state will have $400 million less to spend in the coming fiscal year compared to the current fiscal year.^[27]

On August 24, 2010, the Oklahoma Supreme Court found unconstitutional a new 1 percent fee on paid health care claims that was expected to generate at least $50 million in new revenue that would have drawn federal matching funds for indigent health care.^[24] The Supreme Court rejected the new insurance fee in part because it was passed during the last five days of the legislative session, which the court held violated rules for approving new taxes.^[24] In addition, a proposed traffic camera system that state budget officials expected to generate at least $50 million in revenues from tickets sent to uninsured drivers has run into roadblocks.^[28] Lawmakers were unaware that there is no central database containing all insurance records, but the governor hopes the motor vehicle insurance verification system will be operational summer 2011.^[24]

State Treasurer Scott Meacham, however, said that he did not think more state budget cuts would needed to balance the FY2011 budget despite the loss of more than $100 million in anticipated revenue.^[24] The state is only allowed to appropriate 95 percent of anticipated revenues, so there was a small cushions for such setbacks.^[28] In addition, the cuts can be avoided because of federal funds for Medicaid, increased revenue collections and carry-over money.^[24] Estimates put the amount of one-time money used to close the budget gap at approximately $1 billion.^[24]

[edit] Federal Funds

Oklahoma will receive approximately $321 million from the federal government under H.R. 1586, a $26 billion plan to give states money for Medicaid and education that the President signed into law on August 10, 2010.^[29] The state had not included the federal funds in the FY2011 budget.^[30] Officials expected to receive approximately $193 million for Medicaid, although the federal government said the state could get as much as $203 million for Medicaid.^[30] Federal stimulus dollars for Medicaid would be shared by the Oklahoma Department of Human Services, as well as state mental health and education programs, according to a spokesperson for the Oklahoma Health Care Authority.^[30]

[edit] Budget Transparency

See sample transparency legislation at the Sunshine Standard

Oklahoma OpenBooks is the name of the publicly available website created by the Oklahoma government. It discloses information about Oklahoma's spending and budget, and is managed by the Office of State Finance. It is one of the few state websites that passes all five criteria of the Sunshine Review's transparency checklist.

[edit] Government tools

The Oklahoma OpenBooks page provides a searchable database of state expenditures and revenues. How often the Office of State Finance updates the database varies, depending upon the type of information being updated. For example, payroll and expenditures information is updated monthly, whereas the list of vendors is updated annually.^[31]

The following table is helpful in evaluating the level of transparency provided by Oklahoma OpenBooks:

**Criteria for evaluating spending databases**
State Database	Searchability	Grants	Contracts	Line Item Expenditures	Dept/Agency Budgets	Public Employee Salary
Oklahoma OpenBooks	Y	Y	Y	N	Y	Y

See also: Evaluation of Oklahoma state website

[edit] Limitations and Suggestions

The site should post line-item expenditures.

[edit] Summary of FY 2011 Balanced Budget

Summary of FY 2011 Balanced Budget^[32]

Category	Amount
1. Total Amount Available from Certification Packet	$5,294,829,734
2. Adjustments to Certification
One Year Moratorium on Select Tax Credits	$45,092,800
Repeal Rural Small Business Cap Credit	$37,406,000
Equalize Payments for Services	$18,701,866
Delay Motor Vehicle Apportionment Change	$16,400,000
Decouple from Federal Debt Provision	$11,620,000
Repeal Small Business Cap Credit	$11,060,000
Adopt Revised Sales Tax Vendor Discount	$9,950,000
Vending Machine Decals	$9,000,000
Reform Electric Car Credit	$9,000,000
Maximum Franchise Tax Remitters	$7,800,000
Repeal Motor Fuel Purchaser Discount	$6,100,000
Apportion Tobacco Tax Equalization Revenue to General Revenue	$4,927,000
Smokeless Tobacco Tax Equalization	$4,227,000
Collect Sales Tax on Electronically Delivered Items	$3,460,000
Sales and Use Tax Remittances	$2,998,100
Adjustment to Certification Packet	$2,700,000
Beer Wholesaler Remittance Adjustment	$1,150,000
Liquor and Wine Wholesaler Remittance Adjustment	$840,000
Multi State Model Statute	$836,000
Little Cigar Tax Equalization	$386,000
Total Revenue Enhancements	$203,654,766
3. Recover Cost of Service/Impact to Infrastructure
Oversized Weight Permits	$20,000,000
Certified Copies of Driving Records	$10,600,000
Total Cost of Service/Impact to Infrastructure	$30,600,000
4. Compliance Initiatives
Automated Enforcement of Vehicle Insurance	$95,000,000
Collect Sales Tax on Internet Sales	$95,000,000
Total Compliance Initiatives	$190,000,000
5. Bonding Initiatives
Roads and Bridges	$195,000,000
IT Equipment and Software Purchases	$38,000,000
Total Bonding Initiatives'	$233,000,000
6. Rainy Day Fund and Other Cash
Various State Agencies	$85,411,802
Rainy Day Fund (Amount Used for FY-2011 Budget)	$67,594,528
Rainy Day Fund (Amount Used for FY-2010 Supplementals and Shortfall)	$485,565,496
Excess FY-2010 Gross Production Oil to Education Funds	$42,526,218
Cash to Balance FY-2010	$(343,568,092)
Funds Added back to Education GR FY-2010	$(80,000,000)
Total Cash Transfers	$257,529,952
7. ARRA Funds
ARRA Medicaid Funds	$460,000,000
ARRA Education Funds	$236,468,872
Total ARRA Funds	$696,468,872
Total Revenue	$6,906,083,324
8. CIO Savings Initiative	$(50,000,000)
Total Savings Initiatives	$(50,000,000)
9. Targeted Cuts
Agency Consolidation Savings	$(5,360,000)
Savings from Reductions to Pass-Through Appropriations	$(8,681,000)
Total Targeted Cuts	$(14,041,000)
Total Savings Initiatives and Targeted Cuts	$(64,041,000)
Balanced Budget Summary
1. Appropriations Made by 2009 Legislature	$6,616,561,467
2. Less: FY-2009 Supplementals	$(5,750,000)
3. Less: One-Time Expenditures	$(23,525,000)
4. ARRA Education Funds Used in FY-2010 Budget	$236,352,128
5. ARRA Medicaid Funds Used in FY-2010 Budget	$404,695,751
6. FY-2010 Base Budget	$7,228,334,346
7. 7.5% General Revenue Reductions Made During FY-2010	$(385,827,878)
8. Adjusted FY-2010 Base Budget	$6,842,506,468
9. Targeted Cuts Made in FY-2011	$(65,826,045)
10. Funds Added back to Education Agencies in FY-2010	$80,000,000
11. Available Savings and Cuts	$(64,041,000)
12. Adjusted FY-2011 Base Budget	$6,792,639,423
13. Hold Debt Service Harmless and OSU-Tulsa	$5,740,532
14. Increased Certification to ODOT	$1,926,868
15. Increased Certification to CLO	$4,358,350
16. FY-2010 Supplementals	$101,418,151
17. Executive Budget Expenditures	$6,906,083,324
18. Available Revenues	$6,906,083,324
	$ 0

[edit] Accounting Principles

Main article: Oklahoma government accounting principles

The Oklahoma State Auditor and Inspector audits state and local agencies in the state, publishing its audit reports online. The Oklahoma State Auditor and Inspector is a statewide elected position serving a 4-year term. The office of Examiner and Inspector and the State Auditor was consolidated in a special election on July 22, 1975. Steve Burrage was appointed to the position by Gov. Henry on July 10, 2008 after the June 16, 2008 resignation of Jeff A. McMahan under indictment for accepting improper cash and gifts from an Oklahoma businessman.^[33]^[34]

The Institute for Truth in Accounting (IFTA) rates Oklahoma “Tardy” in filing the state’s Comprehensive Annual Financial Report (CAFR) – The annual report of state and local governmental entities. IFTA rated 22 states timely, 22 states tardy, and 6 states as worst. IFTA does not consider Oklahoma's CAFRs, and those of the other states, to be accurate representations of the state’s financial condition because the Generally Accepted Accounting Principles (GAAP) basis does not include significant liabilities for the pension plans and for other post employment benefits, such as health care.^[35] Oklahoma's CAFRs are annual publications of the Oklahoma Office of State Finance and prepared by the Division of Central Accounting and Reporting. The Oklahoma State Comptroller directs the daily operations of the Division of Central Accounting and Reporting. Brenda Bolander is Oklahoma's State Comptroller and Michael Clingman is Director (appointed by the Governor and approved by the Senate) of the Oklahoma Office of State Finance.^[36]

Credit Rating	Fitch	Moody's	S&P
Oklahoma^[37]	AA	Aa3	AA+

[edit] Stimulus

Oklahoma received $1.9 billion in the prior round of federal funding.^[39]

[edit] Public Employees

Main article: Oklahoma public employee salaries

Main article: Oklahoma public pensions

According to 2008 Census data, the state of Oklahoma and local governments in the state employed a total of 249,724 people.^[40] Of those employees, 198,834 were full-time employees receiving a net pay of $630,491,968 per month and 50,890 were part-time employees paid $41,674,360 per month.^[40] More than 59% of those employees, or 149,326 employees, were in education or higher education.^[40]

[edit] External links

State Budget Solutions, Oklahoma
Oklahoma Council of Public Affairs
Oklahoma OpenBooks, official website
Oklahoma Office of State Finance
Study of State Budget Gaps
Oklahoma Government spending
Model transparency legislation from the American Legislative Exchange Council is available at this link.

[edit] Additional reading

[edit] References

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