August budget cuts by agency: not quite across-the-board

As a follow-up to our earlier post about the announced cuts to state agencies resulting from the shortfall in July revenue collections, we have prepared a spreadsheet that shows how much of a cut each agency will receive in dollar amounts and as a percentage of the initial FY ’10 appropriation. The spreadsheet also includes total FY ’09 and FY ’10 appropriations amounts for each agency. The August cuts, totaling $21.9 million, represent 5 percent of one month’s appropriation from the FY ’10 General Revenue Fund (GRF). This latest development continues to tighten the squeeze on agency budgets.  In June, the state implemented 5 percent across-the-board cuts to agency  allocations as a result of shortfalls in last year’s revenues collections. Most agencies also saw their initial FY ’10 funding reduced by up to 7 percent, at the same time as they are struggling to meet rising employee health care and retirement costs, and in some cases, dealing with growing demands for services as a result of the downturn.

Overall, the August cut represents 0.30 percent of total state appropriations for FY ’10. However, as not all agencies are funded entirely through the GRF, “across-the-board cuts” do not affect all agencies in exactly the same way. This is shown in the graph below, which depicts the cut that the ten largest state agencies must absorb as a share of their total annual appropriation. The Department of Transportation, which is appropriated entirely out of the State Transportation Fund, has not had its funding cut at all. The Department of Education, which receives funding in part through the 1017 Education Reform Fund, the Lottery Fund, and others, was cut by just under 0.3 percent. In addition, this year’s budget included over $600 million in federal stimulus funds from the American Recovery and Reinvestment Act, which is unaffected by the state revenue shortfall. This explains why the cut to the Oklahoma Health Care Authority, which benefits from an enhanced federal Medicaid match under the stimulus bill, was just 0.25 percent of total appropriations. In total, about 30 percent of total state appropriations in FY ’10 – some $2.1 billion – came from funds other than current year GR.augustcuts-agency2

This so-called across-the-board distribution of budget cuts is the only one that can be implemented under the state Constitution and statutes without the involvement of the Legislature. But it does not necessarily reflect the ability of agencies to avoid making cuts that threaten essential public services.  If we are going to be able to navigate these revenue shortfalls in ways that cause the least harm to the health, well-being, and security of Oklahomans, we need to make sure we understand the ways these unequal cuts impact the various agencies’ ability to provide services to the people of Oklahoma. Only then can we determine if across the board cuts will be able to be endured by all agencies or if a different approach is needed.


Former Executive Director David Blatt joined OK Policy in 2008 and served as its Executive Director from 2010 to 2019. He previously served as Director of Public Policy for Community Action Project of Tulsa County and as a budget analyst for the Oklahoma State Senate. He has a Ph.D. in political science from Cornell University and a B.A. from the University of Alberta. David has been selected as Political Scientist of the Year by the Oklahoma Political Science Association, Local Social Justice Champion by the Dan Allen Center for Social Justice, and Public Citizen of the Year by the National Association of Social Workers.

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