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Fallin Suggests Tapping Rainy Day Fund To Ease Education, Corrections Cuts

Gov. Mary Fallin delivers her 2016 State of the State address Feb. 1, 2016.
Joe Wertz
StateImpact Oklahoma
Gov. Mary Fallin delivers her 2016 State of the State address Feb. 1, 2016.

On Monday Gov. Mary Fallin requested taking $72 million from Oklahoma's Rainy Day Fund to provide additional funding to education and prisons.

Under the proposal, $51 million would go to schools, and another $21 million would be earmarked for the Department of Corrections. It’s less than what both agencies hoped for. State Superintendent Joy Hofmeister asked for a $56.2 million supplemental appropriation, and Interim Corrections Director Joe Allbaugh wants an additional $38.7 million to address the cuts from the revenue failure for the fiscal year that ends June 30.

The governor’s office says there’s currently $385 million in the state savings account, with $144.4 million that can be used in Fiscal Year 2016.

"Four-day school weeks and draconian cuts at prisons are not acceptable and are not going to happen. The deepened revenue failure cuts have changed the budget situation in a way that requires immediate action, so I support accessing the Rainy Day Fund for common education and prisons,” Fallin said in a statement. “This is the most responsible option available today to keep vital state services at acceptable levels until the Legislature and I reach agreement on the recurring revenues necessary to fund these services in the long run.”

Fallin proposed making changes to the recurring revenue funding model during her executive budget and State of the State address last month. Fallin called this Rainy Day Fund option a “one-time fix,” and wants to see more of an overhaul to the budgeting process.

There hasn’t been a large deposit to the state’s Rainy Day Fund since 2012, and The Journal Record’s Dale Denwalt reports Democrats at the state Capitol want to see education cuts eliminated entirely, which would cost $109 million:

State Rep. Scott Inman, leader of the Democratic caucus, told reporters last week that the rainy day money should be appropriated to the Department of Education and the Oklahoma Health Care Authority. “Most of that rainy day money is going to need to be used either this year or next year anyway,” said Inman, D-Del City. “The fact of the matter is our teachers and our hospitals have been told to expect a certain amount of money coming out of last year’s budget.” He acknowledged that cuts might be deeper next year if the rainy day fund is tapped to cover the revenue failure. “The cuts are going to come either way either now or next year,” Inman said. “But at least if we say the cuts are going to be deeper next year, our schools and hospitals can adjust to those cuts ahead of time and adjust personnel ahead of time.”

State Sen. David Holt, R-Oklahoma City, says he’s in favor of dipping into the fund this year to help agencies make it to the end of the year. Holt is also leading an initiative to raise the cap on the Rainy Day Fund.

Under current law, the savings account is capped at 15 percent of the general revenue fund certification, which is approximately $5.6 billion this year. That means the maximum amount the fund can hold right now is about $850 million dollars, well short of that billion-dollar budget hole.

Holt's Joint Resolution changes the cap to 15 percent of the total state budget, which he says is approximately $24 billion. It now goes to the House, and if it's approved by the lower chamber, voters will decide on the plan this fall.

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Brian Hardzinski is from Flower Mound, Texas and a graduate of the University of Oklahoma. He began his career at KGOU as a student intern, joining KGOU full time in 2009 as Operations and Public Service Announcement Director. He began regularly hosting Morning Edition in 2014, and became the station's first Digital News Editor in 2015-16. Brian’s work at KGOU has been honored by Public Radio News Directors Incorporated (PRNDI), the Oklahoma Association of Broadcasters, the Oklahoma Associated Press Broadcasters, and local and regional chapters of the Society of Professional Journalists. Brian enjoys competing in triathlons, distance running, playing tennis, and entertaining his rambunctious Boston Terrier, Bucky.
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