Report: Oklahoma Has Biggest Deficit Among States

December 22, 2009

Oklahoma has the unwanted distinction of having the largest revenue shortfall of any state, according to a new report. That reality is illustrated by the state’s revenue collections, which are down by more than 25 percent from a year ago.

The state last week ordered yet another round of cuts, this time instructing agencies to cut 10 percent from their budgets.

A November state budget report by the National Conference of State Legislatures says Oklahoma’s 18.5 percent shortfall for the current fiscal year edges out Arizona’s 18 percent, with Illinois in third at 16.5 percent.

The report says states have lopped $145.9 billion from their fiscal year 2010 budgets compared with 2009. For most states, the fiscal year begins on July 1.

In addition, 36 states have reported additional shortfalls for 2010 totaling $28.2 billion.

Through the first five months of the current fiscal year, Oklahoma’s general revenue fund receipts are 28.5 percent below the same period a year ago and 24.3 percent below projections – a shortfall of $577.5 million.

If the shortfall sustains that rate, general fund revenues will fall more than $1.1 billion short of projections.

State officials say December’s general fund allocations would be 10 percent less than budget amounts – a figure double the 5 percent cuts already in place.

Cuts of such magnitude can leave a lasting effect. Senate President Pro Tem Glenn Coffee, R-Oklahoma City, said shortfall will “reduce the size of state government for the next few years.”

But Coffee said it is too early to tell what will be cut. State agencies appeared to be taken by surprise by the 10 percent reduction. Departments have been putting workers on furlough and cutting services to cope with the 5 percent reduction.

Lauri Monetti, a Department of Human Services spokeswoman, said the additional cuts threaten programs that have been protected to this point because of the federal matching money they attract.

She said cuts in one-time expenditures will likely be made first. She said the “effect will be more significant” if the negative trend in revenue doesn’t reverse soon.

The prison system, which is more reliant on state general fund revenue than most departments, is still analyzing the situation.

Corrections Department spokesman Jerry Massie said the agency has already had a round of early retirements and is running furloughs. The department work force is at three-quarters of its authorized strength.

“We’ll be looking at canceling drug and alcohol treatment contracts, reduction in force, more furlough days, and we may have to look at closing some of the smaller facilities,” Massie said.

Information from: Tulsa World,

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