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OKLAHOMA CITY– A state panel has certified the Oklahoma Legislature will have $878 million less to spend on the budget for the upcoming fiscal year and that additional cuts must be ordered for the current year.

Collections to the state’s general fund fell well short of projections. That means finance officials will order across-the-board cuts to all state agencies, including public schools.

The shortfall for the upcoming fiscal year beginning July 1 means the Legislature will have about 13 percent less to dole out to state agencies than they spent last year.

Oklahoma’s Board of Equalization confirmed both shortfalls during its regular meeting Tuesday.

It’s the third consecutive year with a budget shortfall and the second straight for a revenue failure. A revenue failure is declared when collections fall more than 5 percent below estimates.

State Superintendent of Education Joy Hofmeister released this statement:

“Today’s General Revenue failure, although not unexpected, poses a hardship to districts and schools already stretched thin as a result of ongoing budgetary challenges. It is difficult for any state entity to absorb a budget cut halfway through the fiscal year, but we are thankful to see encouraging signs that the energy sector may be rebounding.”

Gov. Mary Fallin says she would be willing to veto a general appropriations bill approved by the Republican-controlled Legislature if it doesn’t include some investment in state services.

Fallin said Tuesday that she is not willing to cut close to $900 million from state services like public schools, child welfare, health care and state prisons.

Fallin has proposed several tax increases to help close the budget gap, including taxes on cigarettes, motor fuel, and broadening the sales tax to a variety of services. She also proposed eliminating the corporate income tax and the groceries tax.

Senate Pres. Pro Tempore Mike Schulz, R-Altus weighed in on the budget news:

“The budget picture didn’t get any brighter today, but that’s not all that surprising considering the lingering effects of huge slumps in the energy sector and agriculture sector – the two main drivers of Oklahoma’s economy. We already knew crafting a balanced budget this year would be tough and that didn’t change with the news that the budget shortfall has grown. In the face of another budget shortfall, the Senate understands all options are on the table to deal with these challenges. However, it’s important to make sure we don’t overlook solutions like tax incentive reform, apportionment reform, and pursuing agency efficiencies that when combined will provide short-term relief and long-term budget stability.”


Secretary of Finance, Administration and Information Technology, Preston Doerflinger oversees OMES and warns lawmakers they must find a way to bring in more money.

“The numbers are bad this year and next,” Said Doerflinger.  “I don’t know how much more I can emphasize that the time for action is now. We need new recurring revenue sources. If we don’t change our path, then we will be doing incredible harm that could set our state backward for decades.”

Doerflinger also cautioned that more cuts could come later in the year and have fewer months to absorb it.