Oklahoma State Budget Overview

1
Oklahoma State Budget Overview

• Oklahoma Institute for Child Advocacy
• Prepared by the Office of State Finance

2
Good, Bad and the Ugly

• Oklahoma Business Costs Continue to Rank Among
  the Nations LowestRanked 3rd by Pollina
  Corporate Real Estate Study and 5th by
  Economy.ComNorth American Business Review
• State and Local Taxes per capita rank 42nd
• Personal Income Growth in Oklahoma grew the 9th
  fastest in the country in the 2nd quarter of
  2005
• Unemployment remains among the lowest in the
  nation

3
Good, Bad and the Ugly- Oklahomans Without Health
Insurance
15.6
11.4
10.2
18.3
16.1
20.7
19.3
23.5
U.S. 14.6
Source U.S. Bureau of the Census
4
GBU-Percent of Mothers Receiving Late or No
Prenatal Care
4.7
2.7
2.6
5.4
4.6
7.7
3.6
4.9
U.S. 3.7
Source U.S. Department of Health and Human
Services
5
Infant Mortality Rate(Deaths/1000 live births)
6.2
6.8
7.2
8.5
8.4
6.6
9.0
5.7
U.S. 6.9
Source U.S. Department of Health and Human
Services
6
Per Capita Health Care Expenditures
3,444
3,560
3,846
3,290
3,334
3,083
3,782
3,437
U.S. 3,761
Source U.S. Department of Health and Human
Services
7
Oklahoma

• Oklahoma is Fiscally Centralized
• Texas and Oklahoma are at the far ends of the
  fiscal spectrum but have almost identical per
  capita state and local tax burdens
• Economic Figures
• 2003 Gross State Product 107,236 Million -
  30th
• Average Per Capita Personal Income, 28,089
  39th
• Higher than average senior population
• Fewer people in the workforce
• Slightly more young people under 18
• Fewer women in the workforce

8
Where does all the money come from?State
Appropriated Budget
FY06 - 6,125 Million

• Oklahomas sales tax rate is 4.5 percent. Of the
  45 states with a sales tax, 34 have a higher
  sales tax rate than Oklahoma.
• Oklahomas income tax rate ranges from .5 to
  6.65. Of the 41 states with income taxes, 18
  have a higher income tax rate than Oklahoma.

9
General Revenue Fund Sources 100
FY-06 5,148 Million

• From 1982 to 2006, Oklahomas revenue structure
  experienced three major changes. The percentage
  of state revenue derived from sales and use tax
  has increased from 18 to 27 percent. The
  percentage of state revenue derived from gross
  production on oil and gas has decreased from 29
  percent to 13 percent. The percentage of state
  revenue derived from income taxes increased from
  30 to over 43 percent.

10
Where Does All the Money Go? FY06 State
Appropriated Budget 6,031 Million
11
Major State Expenditures

• Common Education 2,164.2 36
• Higher Education 889.4 15
• Career-Technology 130.2 2
• OK. Health Care Authority 634.7 11
• Dept of Human Services 481.9 8
• Dept of Health 62.7 1
• Mental Health/Substance Abuse 171.8 3
• Dept of Corrections 409.4 7
• Department of Public Safety 78.8 1
• Department of Transportation 275.1 5
• Office of Juvenile Affairs 98.3 2
• Total 5,397 89

12
Summary of Certified vs. Actual Revenue for
Appropriated Agencies, FY01 FY05

• From FY-02 through FY-04, certified
  appropriations decreased by 9.6 percent
• Actual Appropriations for this time period
  decreased by 6.26 percent.

13
FY-06 Major Highlights

• Expenditures
• Higher Education - 83.3 million
• 500 Million Bond Issue
• 55 Million for Institutional Budgets and
  Scholarships
• Common Education 104 million
• Health Insurance, Teacher Salary Increases,
  Full-Day Kindergarten
• Health and Human Services - 177 million
• Hospital Provider Fee, Maintenance, Drug Courts,
  Core Services, Premium Assistance Program
• Transportation - 74.2 million

14
FY-2006 Major Highlights

• Tax Cuts - 58 million
• Income rate cut 6.65 to 6.25
• 42.9 million in FY-06 108.2 million subsequent
  years
• Standard Deduction Increase to 4,000 in 2
  years
• 12.6 million in FY-06 30 million in subsequent
  years
• Corporate Capital Gains Tax Cut Oklahoma
  sources
• 2 million in FY-06 10.2 million subsequent
  years
• Retirement Income Exemption - 7,500 to 10,000
• 5 million in FY-06 12.7 million subsequent
  years
• Military Exemption 50 of military retirement
• 409,000 in FY-06 1 million subsequent years

15
Health Care Programs Funded With Tobacco Tax
Increase

• Replace Lost FMAP 49 million or 33
• Premium Assistance Program 49 million or 33
• Trauma System 16.8 million or 11
• OU Cancer Center 6.9 million or 5
• OSU Health Project 6.9 million or 5
• Inpatient Substance Abuse 5.9 million or 4
• Smoking Cessation 2.4 million or 2
• Other- 7

16
2006 Legislative Session Issues

• Fund Previous Commitments- Teacher Salaries,
  Health Care, Edge, Roads, Bond Issue,
  Corrections
• New Issues Roads and Bridges again,
  Corrections again,
• ACE program
• Taxes and Tax and Expenditure Limits (TABOR)
• Economic Development
• Lottery comes on Line

17
FY 07 Commitments

• Health Care Authority 75 to 105 million
• Higher Education 52 million
• Common Education 57 million
• Career Tech 4 million
• Transportation 25 to 100 million
• Corrections 23 to 33 million
• Veterans 2 million
• Mental Health 8 million
• Total- up to 260 to 370 million

18
Revenue Availability

• No estimates available yet- Current year running
  above estimates
• What will be the impact of the Hurricane Katrina?
• Higher Fuel, Food and Transportation Prices?
• Impact of Federal Reserve Action?
• Last year was very good 11 increase in
  appropriations
• A more typical year would be 4- that would mean
  about 250 to 300 million
• Remember the obligations we already have