Oklahoma Corporation Commission discusses 2018 budget request
The Oklahoma Corporation Commission, which has taken on more duties in recent years and is the state’s frontline regulator on induced seismicity, is asking for a budget increase of 11 percent for fiscal year 2018.
The three-member commission discussed the budget request during a regular meeting on Thursday, a day after Commission Chairman Dana Murphy and agency budget officials briefed a legislative appropriations subcommittee.
The Corporation Commission — which has responsibilities from public utilities and oil and gas, to trucking and gas stations — had a total budget of $56.4 million in fiscal year 2017. It received $10.2 million of that from a legislative appropriation, or about 18 percent of the agency’s total budget. The rest of the money came from agency revolving funds and other revenue sources.
For the 2018 fiscal year, the commission is asking for an extra $6.4 million, although Tim Rhodes, director of administration, said the agency doesn’t expect all of that to come from the general revenue fund.
“Yes, we do need resources, but we will come with suggestions on how we can assist the Legislature in helping to provide those resources,” Rhodes said in Thursday’s meeting. “In other words, we have a problem, but we’re offering a solution as well.”
The bulk of the additional money is for a wellplugging fund ($2.35 million), trucking ports of entry and weigh stations ($1.66 million) and various information technology initiatives ($1.38 million). Some of that can come from a reallocation of existing funds in those programs or a restoration of revolving funds moved in prior years, Rhodes said.
The commission also requested $584,000 for induced seismicity oversight, which would replace one-time, emergency money granted to the agency last year by Gov. Mary Fallin and the Secretary of Energy and Environment. The money was used for data collection and analysis of wastewater injection wells volumes and pressure, as well as equipment and outreach.
“Seismicity will continue to be a safety concern for Oklahoma citizens after the grant funds have expired; however, the agency has no alternative funding to continue this program unless additional appropriations are received,” the agency said in its budget request.
The commission has taken steps to curtail the volume of wastewater from oil and gas production into deep Arbuckle disposal wells, which have been linked to the state’s rise in earthquakes. Its areas of interest for Arbuckle disposal wells now cover almost 16,000 square miles and involve more than 700 disposal wells.
Agency budget officials said lawmakers plugged budget shortfalls in the past two years by using $3.35 million from revolving funds and directing them to general agency operations. That included $2.5 million from the wellplugging fund in the current fiscal year, Rhodes said. Because of the recent energy downturn, the fund won’t replenish itself at historical rates.
“Restoration of the funds will allow for plugging of more wells before they become an imminent threat to public health and safety and require emergency plugging, a far more expensive process,” the agency said in its budget request.
The commission spent more than $800,000 in fiscal year 2016 to plug “orphaned” wells with no known owners. That included 20 high-priority wells that posed imminent threats to public health. More orphaned wells had to remain on a waiting list due to the lack of funding in the program, the request said.
The Corporation Commission has 484 employees, although it is authorized to have up to 523 employees in the current fiscal year.