| October 11, 2011
State agencies ignore fiscal reality
A year ago, many state-appropriated agencies in Oklahoma responded to the realities of diminished revenue by requesting an increase in appropriations of about $1.5 billion. Alas, it seems the concept of a realistic budget request is still foreign to many state-appropriated agencies.
October 1 is the annual deadline for state agencies to submit their budget requests to the Oklahoma Office of State Finance (OSF). These requests serve as a starting point for lawmakers to analyze the potential needs of state agencies for the next fiscal year. So far, the OSF has received requests for increases of $779.4 million in state appropriations. The requests have also asked for increases in full-time equivalent employees of 822. Yes, you read that correctly. Presumably with a straight face, state bureaucrats are asking the legislature to increase appropriations from $6.5 billion to at least $7.2 billion, an increase of about 12 percent! And the total amount requested so far will only increase, because agencies like the State Department of Education, the State Regents for Higher Education, and the Department of Corrections—which represent more than half of total state appropriations—have not yet submitted their requests to OSF.
State revenue collections are increasing at a level of around 7 percent. Assuming growth in appropriations authority of 7 percent, which would be incredible considering the national economy, agencies already want to spend every dime—and more—of any growth in state revenues and appropriations.
It is clear state bureaucrats are not focusing on the reality that citizens who fund government want bureaucrats to spend less money, not more. Rather, bureaucrats are trying to find every possible way to spend even more than is available. Contrast this with the taxpaying Oklahomans who are paying the freight; their private earnings grew only 2.34 percent from 2009 to 2010.
Let’s hope lawmakers are not as out of touch with reality as are state bureaucrats. Lawmakers should pay attention to the reality that 65 percent of likely Oklahoma voters would prefer to phase out the income tax without raising other taxes, and that Oklahomans want lower taxes and a smaller state government.