OKPOLICY.ORG
Last week, the State Senate began its budget work that will culminate sometime in May in passage of a new state budget for Fiscal Year 2026, which starts on July 1, 2025. It held meetings of the Natural Resources and Regulatory Services and the Education Appropriations Subcommittees. The first step in the appropriations process is the appearance in appropriations subcommittees by state agency directors and representatives to report on results achieved with the funding provided for the current year and to explain their budget request for FY26.
Members who were on the subcommittees last year will remember what they were told the funding was to be used for. They will be ready to hold agencies accountable for keeping their word and to determine if the expenditure was efficient and worthwhile. New members will begin learning the nuts and bolts of the agencies they fund and developing more informed opinions about the value and performance of the agencies than they may have brought with them before becoming a member of the committee. The best way to understand state government is to “follow the money.”
The state agencies began forming their budget last fall with their budget requests due to be turned in to the Office of Management and Enterprise Services (OMES) on October 1. The governor, presumably using the requests made by his agencies, formulates his proposed budget within the limitations of the certified funds available for appropriation.
This is no doubt going to be a tight fiscal year, unlike the past few years when the state’s economy produced remarkable amounts of state revenue. In its December meeting, the Oklahoma Board of Equalization certified $191 million less for legislators to appropriate than they appropriated last session. The equalization board will meet again in February to make adjustments and give the legislature a final number.
During the past few years, legislators have had enough revenue to increase funding for some functions, to put money into various savings accounts, and to cut taxes. They’ve created some new programs and tried to “catch up” in areas that have been traditionally underfunded like education, health, mental health, and maintenance of state services and properties.
They’ve also passed tax cuts, led by repealing the state portion of the sales tax on groceries costing the state just under $400 million in revenue and a tax credit for the benefit of about 40,000 out of four million Oklahomans who send their kids to private school, costing $250 million.
In the Education Subcommittee, State Superintendent Ryan Walters presented a budget request seeking an increase of nearly $91.2 million for FY26 plus $7.3 million in one-time funding. The agency also requested $11.2 million in supplemental funding for teacher and support personnel flexible benefit allowance costs. Chancellor Sean Burrage, on behalf of the Regents for Higher Education, requested an increase of $95 million for higher education.
Various smaller agencies in the Natural Resources and Regulatory Services subcommittee requested a total of just under $30 million in new funding. According to House data compiled in early December and reported by Oklahoma City TV channel KOKH, state agencies have requested $832 million more for FY26 than was appropriated for the current fiscal year.
But with at least a $191 million hole in the budget to start, it looks like Oklahoma will revert to form with scarce funding. The money stashed away in various accounts during the past few years may be a cushion, probably avoiding cuts to important state services. But Gov. Stitt will likely renew his mantra of calling for tax cuts, despite his executive agencies’ requests for additional funding.
