OKPOLICY.ORG
What’s up this week at Oklahoma Policy Institute? The Weekly Wonk shares our most recent publications and other resources to help you stay informed about Oklahoma. Numbers of the Day and Policy Notes are from our daily news briefing, In The Know. Click here to subscribe to In The Know.
This Week from OK Policy
Policy Matters: What’s your vision for Oklahoma?: Take a moment to reflect on your vision for our state. What does your ideal community look like? What opportunities do you want for your children, your neighbors, and yourself? Once you’ve thought about it, share it. Start conversations with your family and friends. Better yet, discuss your vision with elected officials. [Shiloh Kantz / The Journal Record]
Policy Matters: Making 2025 a year of bold action for our children: As we welcome the new year, it’s time to set our sights on building a brighter future for Oklahoma—a future where every child, every family, and every community has the opportunity to thrive. The challenges before us are clear. OK Policy’s 2024 KIDS COUNT data highlight areas where we’re falling behind, with some indicators placing us dangerously close to the bottom of the national rankings. One in 5 Oklahoma children lives in poverty, and 200,000 children are growing up in households that don’t always know where their next meal will come from. [Shiloh Kantz / OK Policy]
Upgrading teacher salaries can reverse state’s growing teacher shortage crisis (Capitol Update): Instead of slashing income taxes and stashing cash away in various holding accounts, the efforts of these legislators could be greatly enhanced if the Legislature would demonstrate to teachers the state values their calling by vastly upgrading teacher salaries. [Steve Lewis / Capitol Update]
OK Policy in the News
Opinion: In 2024, Oklahomans spoke out on education, race, abortion, other topics in Sunday feature: “One out of five children live in poverty in Oklahoma. How are we addressing that? Because until we address the poverty situation, we’ll never have change.” – Shiloh Kantz, executive director of the Oklahoma Policy Institute. [The Oklahoman]
Weekly What’s That
Revenue Estimates/ Revenue Certification
- In late December, the State Board of Equalization certifies a preliminary estimate. This estimate becomes the basis of the Governor’s executive budget proposal.
- In mid-February, the Board of Equalization certifies a revised estimate considering changes in revenue collections and economic conditions. The February certification is binding on the Legislature and establishes the maximum amount it can budget under existing laws for the coming year.
- In late June, the Board may revise the official revenue estimate up or down only if the Legislature has made changes to the law that affect state revenue.
Revenue estimates for Oklahoma’s major taxes are prepared by the Oklahoma Tax Commission based on a model developed by an economist at Oklahoma State University. Other taxes and fees are estimated by other means.
Look up more key terms to understand Oklahoma politics and government here.
Quote of the Week
“You have to figure in bills, gas, you know — the basic necessities on top of two children. And then I also have to look at the fact that I have these fines and costs that I have to pay back because potentially, I could end up back in jail, and then what are my kids going to do?”
-Nicole Ratcliffe, a formerly incarcerated person, talking about the day-to-day impact of the $40,000 in court expenses that she owes. Most defendants aren’t necessarily told fines and costs, which are specific to each criminal case, before they agree to pay the total amount. [Public Radio Tulsa]
Editorial of the Week
Opinion: Caution urged at Oklahoma Capitol when considering budget plan
Oklahoma’s state revenue has peaked, and projections show significant declines in available funds for the next fiscal year. In light of these challenges, state leaders must adopt a cautious fiscal strategy to safeguard economic stability.
As a small business owner, I follow a similar approach by planning for downturns while striving for growth. When planning the annual budget for our business, I always assume a 3% to 5% drop in revenue. Then, we work hard to achieve 8% to 12% growth. This strategy has served us well over nearly three decades through both up and down business cycles. As a result, I’ve never had to lay off employees during bear markets or recessions.
Similarly, caution is warranted when considering the financial condition of the state of Oklahoma and the newly released revenue estimates for the next fiscal year. According to projections, state revenue has peaked after a wave of monetary inflow following the COVID-19 pandemic.
This influx of federal money created a surge in state revenue, akin to an ATM endlessly spitting out cash. But now, the federal “ATM” has been turned off, and state leaders must be careful with spending.
The Board of Equalization’s preliminary estimate indicates the state will have $152 million less to spend in the next fiscal year. Additionally, current fiscal year collections are projected to fall $124 million short of expectations.
At first glance, these drops may not seem alarming, especially with a reported $4.6 billion in state savings. However, this savings figure includes federal and education set-asides, leaving a real balance of $3.4 billion. Maintaining reserves of $3 billion to $5 billion is essential for fiscal stability, so there isn’t much extra money available.
By adopting fiscal discipline, Oklahoma can weather current challenges and secure a stable financial future for its citizens.
Numbers of the Week
- 11.4% – The share of Oklahoma residents who lacked health insurance in 2023. [U.S. Census via OK Policy]
- 1% – The Oklahoma Board of Equalization in December certified an estimate of $8.662 billion for General Revenue collections in Fiscal Year 2026, which starts on July 1, 2025. This year’s General Revenue estimate is about one percent lower than last year’s December estimate. [OK Policy]
What We’re Reading
- Economists: Rural Uninsured Rates Likely to Rise if ACA Premium Tax Credits Expire: The number of rural residents who aren’t covered by health insurance is likely to rise if the premium tax credits associated with the Affordable Care Act expire at the end of 2025. Researchers with the Urban Institute and the Robert Wood Johnson Foundation found that those who opt to continue to carry health insurance even after the tax credits expire would see their premiums skyrocket, in some cases more than doubling. For residents in rural communities across the country, those rising prices could mean not having access to health insurance anymore. [The Daily Yonder]
- A Benign Year in Public Finance: Will We Be Nostalgic for Normality?: The taming of inflation was the main financial story. Bond and capital markets were cooperative, even if voters upset about property taxes were not. Governors, mayors, finance directors and pension pros may soon look back wistfully at 2024’s business-as-usual atmosphere. [Governing]
