Staff and Wire Reports
OKLAHOMA CITY -- Democratic Gov. Brad Henry and Republican leaders of the House and Senate reached an agreement on a state budget for the fiscal year that begins July 1, several Democratic lawmakers said Thursday.
Lawmakers have to build a state budget for the upcoming fiscal year with about $1.2 billion less to spend than they had last year. By using the remainder of the state's federal stimulus funds and money from state cash reserves, the budget hole is still estimated to be about $600 million. To close that gap, lawmakers would have to either impose deep cuts to agency budgets or approve some measures to raise revenue, like increasing fees or suspending various tax breaks.
The agreement is designed to shield core services by enacting smaller, targeted cuts to key agencies in education, health care, public safety, transportation and other priority areas.
Under the FY 2011 agreement, $6.68 billion in general revenue will be appropriated to state agencies and programs, K-12 education and career technology education will receive targeted cuts of just 2.9 percent and higher education's budget will be reduced by 3.3 percent.
The Department of Public Safety will be cut by only 1 percent and the Department of Corrections will receive a 3 percent reduction.
The agreement also calls for providing additional, long-term funding to the Oklahoma Department of Transportation for road and bridge maintenance and repair efforts.
The Oklahoma Health Care Authority will receive an increase in overall funding from other sources to address expected cost increases in health care programs and the Department of Mental Health and Substance Abuse Services will be cut by .5 percent and the Department of Veterans Affairs by 3.5 percent.
The agreement also calls for a $5 million line-item appropriation to senior nutrition programs and $12.4 million to the Rural Economic Action Plan or REAP.
"In the face of a historic revenue shortfall, this was a very difficult and painful budget to craft, but I am proud that we were able to strike an agreement that largely protects the core services that are so important to Oklahomans and the state's economic recovery," said Gov. Henry. "All levels of public education and our classroom teachers in particular play such an important role in this state's economic future that it was critical to shield them from the deepest cuts, and we did that.
"I want to thank Speaker Benge, Pro Tem Coffee and Democratic leaders Charlie Laster and Danny Morgan for all of their hard work and diligence under very challenging circumstances. Many agencies and programs will still feel the pain of the budget crunch, and that was unavoidable, but despite some bumps along the way, we were able to strike a bipartisan agreement that will help Oklahoma recover from these trying economic times. "
Legislative leaders also praised the budget agreement.
"This budget represents the tough decisions we have said all session would be required to fill a $1.2 billion shortfall, which inevitably will touch every aspect of state government. I believe this budget insulates vital government services like public safety, transportation, health care and education from dramatic cuts while also leaving our state in a fiscally sound position for the next Legislature and beyond," said Speaker Benge, R-Tulsa. "This budget is a true product of consensus, which means compromises were made on both sides of the aisle. We believe this is a fiscally prudent budget that will help our state continue to weather this economic downturn with the hope that revenues will stabilize as the economy improves. What our state is dealing with is not unique, but I believe we were prepared for this day and handled it much like many Oklahoma families are treating their own personal budgets. We have lived within our means."
"In divided government, parties have to work together to do the people's business. During a tight budget year, this agreement provides a responsible reduction in spending and protects taxpayers from a tax increase. Republicans have always fought to be prudent with taxpayer dollars, and I knew it was vital to maintain the $100 million reserve fund that will aid in the probable FY 2012 budget holes," said Senate President Pro Tempore Coffee, R-Oklahoma City.
"The Governor, Speaker and I were able to work together in a bipartisan fashion and keep Oklahoma's government running. I especially want to thank Senator Mike Johnson, our Appropriations Chairman, for his expertise and vision in helping us draft a budget that adequately funds the core functions of this great state."
Lawmakers will now need to pass a variety of bills needed to implement the budget agreement, including a general appropriations bill.
The Legislature must adjourn by no later than 5pm, Friday, May 28.
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