Board of Equalization Approves 2011 State Budget , About $1 Billion Less

Staff and Wire Reports

OKLAHOMA CITY -- Oklahoma will have less money to spend next year because of a severe budget shortfall.

Tuesday the board of equalization approved a budget estimate of $4.4 billion for the 2011 fiscal year. That's about a billion less from this year's budget. Of that, the state will be allowed to spend only $4.3 billion.

Lower than expected oil and gas prices are to blame for less revenue coming into the state. Governor Henry discussed what's in store for Oklahoma's economic future.

"The cuts that have implemented were necessary and they're not going to go away," Gov. Henry said. "Agencies are going to face cuts."

State agencies started cutting their monthly budgets back in June to make up for the shortfall. So far those cuts generated about $278 million. Governor Henry said Oklahoma is in a better place than most states because it has more than $1 billion in rainy day and stimulus funds.

Treasurer Scott Meacham said the total spending authority for the 2011 fiscal year, including rainy day funds, stimulus funds and cash, will be $5.3 billion, which is still $1.3 less than the 2010 fiscal year.

Meacham released preliminary revenue figures Monday that the board reviewed to determine the upcoming fiscal year.

Revenues have fallen to near-record levels and state agencies cut their allocations by 20 percent, which were previously cut by 10 percent.

Meacham said revenue is forecast to decline almost $967 million, or 17.6 percent, from the current fiscal year.

Attorney General Drew Edmondson, who voted for this reduced budget, said the fiscal crisis of 2010 will be a test for the state's next chief executive. He is running for that office.

"We need to take the opportunity of 2011, which will be the first year of the next governor, to do the kind of streamlining of state government, making state government more efficient," Edmondson said.

For State Superintendent Sandy Garrett that means working to preserve education.

"I believe that you should look at those basic services and try to keep as much of that intact as possible," Garrett said.

Governor Henry said there are ongoing conversations with legislative leaders about how best to spend the next fiscal year's budget, but he doesn't believe a special session is necessary. Henry also said he is does not think there should be across-the-board cuts for all state agencies, and that cuts should be targeted toward agencies that are less profitable.

Senate President Pro-Tem Glenn Coffee released this statement about the State Equalization Board announcement:

"Given the reality of our state financial condition as certified by the State Equalization Board today, I'm ready to continue the discussions we've been having with Governor Henry and Speaker Benge and our leadership teams, and make some hard but necessary decisions. At this point, no agreements have been made beyond January, so I look forward to moving forward with the framework we now have before us."