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OKLAHOMA CITY – An Oklahoma agency says it is taking extreme measures after a serious drop in funding.

On Friday, the Oklahoma Department of Human Services alerted its employees and contractors that the agency is facing a $100 million shortfall in state funding.

DHS Director Ed Lake says the agency lost $64 million in state and federal funding this fiscal year, and will lose another $58 million after two state revenue failures.

“Our fiscal circumstances are so serious that we must examine the potential for reductions in every administrative, service, benefits  and program area in this agency,” said Lake. “This news cannot be sugar-coated- the results will be painful, barring what would be some kind of fiscal miracle.”

He says the agency is getting ready for unprecedented cuts to programs and services.

Lake says DHS may be forced to reduce services that help keep some elderly Oklahomans out of nursing homes and other programs that focus on the health and support of elderly Oklahomans and residents with developmental disabilities.

Programs that deal with child care licensing and child support services will be reduced. Also, child care subsidies for low-income working families will be limited and many contracts with vendors will be eliminated.

Since most of the agency’s budget goes to paying employees, agency officials say they are planning for “significantly greater reductions in the number of employees.” Over the past two fiscal years, 1,200 non-child welfare positions have been cut.

“These cuts have virtually eliminated any funds we normally hold for emergencies and most of the carryover funds that would have been available to maintain expenditure levels in the coming fiscal year,” said Lake. “Dire financial circumstances are forcing us to make significant cuts now while we plan with utmost seriousness for implementing potentially disastrous actions that will most assuredly compromise our ability to carry out the core services of DHS—primary “safety net” services.”

As if the situation isn’t bad enough, Lake believes another budget shortfall is on the horizon.

In order to balance the budget, Gov. Fallin proposed increasing revenues, eliminating some tax incentives and passing a bond measure.

“If the Legislature does not act upon these ideas or find other ways to raise revenues for the state by the end of this session, DHS will be facing even deeper budget cuts we simply cannot make without significant consequences for people who depend on our assistance and for our many service partners whom we count on to supplement and complement our mission.  Even if the Legislature follows the Governor’s lead, our available funds will be dramatically less than what is needed to continue our agency in its current form,” he said.

Basic assistance programs like food stamps and cash assistance are federally funded and will not be impacted by the state’s budget cuts.