Legislature to have $612 million more to spend
The Oklahoma Legislature is expected to have about $612 million more to appropriate next fiscal year, according to revenue projections certified Wednesday by the State Board of Equalization.
"Our economy is starting to take off, unemployment is low and it's a really, really exciting time," said Gov.-elect Kevin Stitt.
Stitt quickly followed up his optimistic remark with a warning to lawmakers and agency heads: "This is not a blank check," he said. "This is not something that you can just come in and say, 'Hey, how can we fund our pet projects.'"
"I was elected as governor to make sure that we do government differently, that we hold agencies accountable, that we deliver services to move us up to the top 10."
Stitt, who will take office on Jan. 14, and state lawmakers said much of the growth revenue is already spoken for.
About $100 million will be needed to make property tax reimbursements to counties and school districts to offset tax subsidies granted to the wind industry, Stitt said.
Another $30 million will be necessary to keep University of Oklahoma and Oklahoma State University medical doctors graduate training programs operating due to a loss of federal funds, he said. And $17 million will be needed for bond payments on projects that include the state Capitol renovation.
"We also are going to make sure that we take care of our teachers with their health care benefits and costs going up," Stitt said.
Senate Appropriations Committee Chairman Roger Thompson said the state also will need to replace about $14.8 million in reduced federal funding for The Children's Hospital at OU Medical Center.
And, because of an Oklahoma Supreme Court ruling, the state will need to reimburse insurance companies up to $80 million they paid into the state's workers' compensation Multiple Injury Trust Fund, Thompson said.
Prisons, justice reform among priorities
The additional $612.4 million that the Legislature is expected to be able to appropriate next fiscal year would be 8 percent more than the nearly $7.7 billion in expenditures that were authorized for the current fiscal year, which concludes June 30.
"That's a good number, but we still have some bills that we need to pay," Thompson said.
State Rep. Kevin Wallace, chairman of the House Appropriations and Budget Committee, said he expects that a funding boost for the Department of Corrections and paying for criminal justice reform will be among the top priorities of House members.
The Department of Corrections has asked for an increase of more than $1 billion next fiscal year to add 5,200 prison beds, provide inmates with hepatitis C drug treatments, give staff raises and pay for facility repairs and maintenance.
Other agencies are also lobbying for funding increases that, when combined, would far exceed additional funds the state expects to receive.
"I think we've got to look at the overall budget as a whole and the past 10 years of cuts," Wallace said. "I think everyone should be adjusted equally in amounts. I say that percentage-wise."
Wallace said he is concerned the amount the Legislature has available for appropriation will drop in February when the Board of Equalization comes back to certify a final revenue estimate because oil and gas prices have been dropping recently.
Fallin credits recent actions for increase
Gov. Mary Fallin, who is finishing her final term, said actions taken at the Capitol over the last two years have put the state in a more stable revenue position.
Revenue increases last fiscal year enabled officials to deposit $381 million into the state's Rainy Day Fund, raising the fund's total to more than $451 million. Current projections call for the state to be able to add another $422.7 million to the fund at the end of current fiscal year, which would bring it close to the current constitutional cap of about $878 million, said Shelly Paulk, the state's deputy director of finance.
The state is able to tap those funds for emergencies and to ease funding woes during economic downturns.
Stitt said Wednesday that he would like to see the cap raised so that $2 billion could be accumulated in the account, which would put the state in better position to deal with economic downturns.
Stitt said he plans to create a cabinet position called Secretary of Agency Accountability. The person appointed to that position will serve as a chief operating officer and help agencies establish metrics to measure their performance, he said.
Stitt also plans to have a Secretary of Budget, to be named Thursday, said Donelle Harder, spokeswoman for Stitt.
In addition to certifying projected revenues, the State Board of Equalization authorized $77.3 million to be used to fund the state's Oklahoma's Promise program, which provides Oklahoma college tuition scholarships to Oklahoma students who meet academic and conduct requirements and whose families earn $55,000 or less annually.