Budget: $8.3B spending plan includes $300M for savings

Gov. Kevin Stitt wants the state to live within its means in the state budget he has proposed for the fiscal year that begins July 1.

Stitt on Monday unveiled his executive budget proposal for the upcoming fiscal year — an $8.3 billion budget that includes socking away $300 million in state savings accounts.

“We've taken a conservative approach with the fiscal year `22 budget as the country and Oklahoma will continue to navigate unknowns in the wake of the pandemic,” said Amanda Rodriguez, the state's chief financial officer .“What is known is we will continue ensuring every dollar matches the value and vision of Oklahoma becoming a top 10 state.”

Secretary of State Brian Bingman said the budget proposal outlines the governor's t op spending priorities for next year, and serves as the beginning of budget negotiations with state legislators.

“It' s kind of a starting point,” he said. Stitt's proposed budget is an increase from the $7.8 billion budget lawmakers approved for the current fiscal year.

In December, the Board of Equalization certified an estimated $8.5 billion in state funds available in the upcoming fiscal year, but Stitt proposes weaning the state off roughly $1 billion in one-time spending that won't be available in the following fiscal year.

The budget board will revise its budget figures later this month, and lawmakers will use the updated numbers to build the state budget.

Health care and education spending remain flat in the governor's budget proposal.

Medicaid expansion

Stitt's budget funds Medicaid expansion, which state leaders are required to cover after voters narrowly passed State Question 802 last year.

To pay for the state's share of the expansion, an estimated $ 164 million, Stitt proposes boosting a hospital fee called the Supplemental Hospital Offset Payment Program to its ceiling of 4%.

Stitt's budget also factors in some cost savings from changes to Insure Oklahoma, a program small employers use to provide health insurance to their lowincome workers. Many of the Oklahomans currently receiving health insurance coverage through Insure Oklahoma are expected to be covered under the expansion.

Boosting state savings

After state lawmakers dipped into state savings accounts to offset a revenue shortfall last year due to plunging gas prices and the COVID-19 pandemic, St itt wants to shore up the accounts.

The governor proposes soc king away $300 million in the Revenue Stabilization Fund.

The Revenue Stabilization Fund currently holds $171 million and the state's Rainy Day Fund holds another $58 million. This time last year, the Rainy Day Fund included just over $1 billion.

Rodriguez characterized the budget proposal as conservative.

“We're able to make a deposit into savings, we're able to get pensions back to fully funded and we' re funding critical services throughout state agencies,” she said.

Stitt wants state lawmakers to deposit $125 million into four state pension systems to make up for the funding that was redirected last year to fill budget holes.

Business spending

Stitt is proposing a $32 million increase to the Department of Commerce in the hopes of bringing more workers to Oklahoma.

He wants an additional $20 million deposited in the Quick Action Closing Fund, an economic development fund dedicated to attracting businesses and jobs to the state.

He also asked for $15 million, which would be matched with private funds, for a jobs accelerator program to encourage new business ventures in the state.

St it ta ls ow ants to offer financial incentives to entice remote workers to move to

Oklahoma, although he hasn't set a dollar figure for that program yet.

Other budget priorities:

• A $ 30 million reduction for the Department of Mental Health and Substance Abuse Services due to Medicaid expansion. No reduction in services is anticipated.

• $ 2 million to reduce the Developmental Disabilities Services waiting list.

• $7 million for a new offender management system for the Department of Corrections.

• $2.3 million for a per diem increase at CoreCivic private prisons in Oklahoma.

• $5 million to the Office of Management and Enterprise Services for cybersecurity software to protect state assets.

•$250,000 for the State Election Board to cover increased costs due to redistricting.

•Reducing the number of classified employees and reforming the state's civil service system.