Skip to Site Navigation | Skip to Content

Shot in the arm helped Oklahoma lawmakers balance budget

Shot in the arm helped Oklahoma lawmakers balance budget

OUR VIEWS: state’s fiscal outlook

The Oklahoman Editorial

Published: June 1, 2009

State lawmakers shot an ARRA in the air and hit the target of a balanced budget for fiscal year 2010.

In the sausage-making exercise known as budget crafting, legislators use a variety of means to achieve a balance. Sometimes it involves draining the Rainy Day Fund or raiding a special purpose fund. This year it involved money from the American Recovery and Reinvestment Act (ARRA).

Coincidentally, the amount of deficit the Legislature faced at the start of the year, the value of the Rainy Day Fund and the money available from Uncle Sam were roughly the same — in the area of $600 million to $650 million.

On the table were budget cuts ranging from "surgical” strikes, favored by Gov. Brad Henry, to across-the-board cuts involving every area of state services. The sausage that left the Capitol was spiced with a 7.1 percent cut when ARRA funds aren’t included. With the federal stimulus money, the budget is actually 1.5 percent higher than last year, according to an analysis by the Oklahoma Policy Institute.

Lawmakers used $641.1 million from ARRA to avoid deeper cuts and to ensure no cuts for education. To their great credit, they left the Rainy Day Fund alone.

Putting the budget in context is difficult at this point. As Oklahoma Policy Institute consultant Paul Shinn notes, "Budgets don’t mean much in themselves. Their importance is in the level of service they establish and in how services are allocated. Thanks to Oklahoma’s rushed and largely hidden approach to budgeting, we can’t say a lot about what this budget means ...”

We can say that fears about next year being worse may be exaggerated. Signs of a national economy recovery and a rebound in energy prices portend better days, making the decision to avoid tapping the Rainy Day Fund more wise but also more controversial: If it won’t be needed next year, why not use it now to ease state government’s pain and suffering? But taxpayers feel that pain in their own households and have limited sympathy for agency heads now figuring out what they must cut.

If state finances don’t start to stabilize, the worry is that federal stimulus money won’t be available for fiscal 2011. Instead of an ARRA shot in the arm, next year’s budget archery could target the Rainy Day Fund.

No comments (Add your own)

Add a New Comment


code
 

Comment Guidelines: No HTML is allowed. Off-topic or inappropriate comments will be edited or deleted. Thanks.