- Associated Press - Monday, February 3, 2014

OKLAHOMA CITY (AP) - A one-quarter percent cut in the state income tax and 5 percent budget cuts to most state agencies highlight a budget plan for the upcoming year unveiled Monday by Gov. Mary Fallin’s administration.

The proposed budget for the fiscal year that begins July 1 includes almost $114 million in targeted new appropriations for services such as human services, education and public safety. But the $7 billion budget proposes spending about $71 million, or 1.3 percent, less than the current fiscal year, Secretary of Finance Preston Doerflinger said.

“I think it is a conservative budget,” Doerflinger told reporters during a briefing on the governor’s budget plan. “It’s a budget the state could adopt today.”

Fallin outlined the budget plan in her State of the State address to kick off the 2014 Oklahoma Legislature. The proposal will jumpstart discussion among lawmakers on finalizing a budget for the upcoming year before they adjourn May 30.

The state is projected to have $170 million less in revenue next year than the current year. The income tax cut would reduce revenue by about $47.5 million in 2015 and $71.1 when fully implemented in 2016.

In spite of the budget shortfall, Doerflinger said, reducing the income tax remains part of Fallin’s agenda for taxpayers to keep more of the money they earn.

“It’s their money,” he said. The reduction would reduce Oklahoma’s 5.25 percent top income tax rate to 5 percent.

Targeted increases in appropriations include $50 million for the Department of Education for local school district operations, reading sufficiency programs, charter school building funds and teacher benefit costs. It would increase the agency’s budget by 2.1 percent, to almost $2.5 billion.

The Department of Human Services would receive an additional $37 million, an increase of 5.9 percent that would boost state appropriations to about $668 million. The additional funds would support efforts to implement The Pinnacle Plan, a three-year effort to give child welfare workers raises and improve services.

Fallin recommended an additional $5 million for the Department of Public Safety to provide a pay increase to state troopers beginning Jan. 1. The boost represents a 4.5 percent budget increase to about $94.5 million. The budget plan also proposes maintaining a $5 million annual appropriation for a Trooper Academy.

But most other agencies would have their budgets cut by 5 percent under the plan. Proposed cuts include $47.7 million from the Oklahoma Health Care Authority, the state’s Medicaid provider, and $49.4 million from the Regents for Higher Education.

In spite of the cuts, Doerflinger said the revenue situation “is hardly a budget crisis.”

“It’s going to be just fine,” he said.

During her State of the State address, Fallin threw her support behind a bond issue to begin repairs to Oklahoma’s nearly 100-year-old state Capitol, which she characterized as “a safety hazard.” Scaffolding and yellow barriers have been erected along the building’s southeast corner to protect visitors from falling debris from its crumbling facade.

Fallin’s executive budget proposes $7.68 million for the first year’s debt service on a $120 million bond issue for Capitol repairs. It also proposes $2 million in debt service on bonds that will pay for construction of a new Office of the Chief Medical Examiner headquarters on the University of Central Oklahoma campus in Edmond.

The budget plan would consolidate the Commission for Teacher Preparation into the Commission for Educational Quality and Accountability and require that the consolidated agencies save 15 percent in appropriated dollars in its first year.

It also proposes consolidating five agencies - the Arts Council, Historical Society, J.M. Davis Memorial Commission, the Will Rogers Memorial Commission and the Oklahoma Scenic Rivers Commission - with the Oklahoma Tourism and Recreation Commission at a 15 percent cost savings.

“This is not a move to eliminate the Arts Council,” Doerflinger said. “We believe the missions will be enhanced.”

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