DALLAS — Oklahoma Gov. Brad Henry and Republican leaders in the Legislature reached an agreement late last week on a proposed $6.7 billion general fund budget for fiscal 2011 that relies on more than $1 billion of one-time money to cover a revenue shortfall estimated at $1.2 billion.
The Senate and the House passed SB 1561 late Friday after months of negotiations between the Democratic governor and Republican lawmakers.
The budget measure is expected to reach Henry’s desk by the end of this week.
The spending plan includes $195 million of state highway bonds and $38 million of bonds for the purchase of information technology hardware and software. The bonds would be issued by the Oklahoma Capitol Improvement Authority.
The State Board of Equalization, which provides revenue forecasts used to develop the general fund budget, has estimated that fiscal 2011 revenue will total $5.4 billion.
The fiscal 2011 budget includes the final $540 million of federal stimulus funds, $225 million from the budget stabilization fund, $180 million from new and enhanced collection efforts, and $150 million from freezing some tax credits.
The 2011 budget is 7.2% less than the $7.2 billion budget for fiscal 2010 that lawmakers approved last year. However, unexpected double-digit declines in revenue that began in August reduced actual expenditures in fiscal 2010 to $6.9 billion.
The final budget package, including general appropriations measures, must be sent to Henry by Friday. The current legislative session must end no later than 6:30 p.m. Friday.
Fiscal 2011 will begin July 1.
The rainy-day fund was at its constitutional limit of almost $600 million at the beginning of fiscal 2010.
The fund is now at $149 million after lawmakers used $223.5 to cover a revenue shortfall in fiscal 2010 and $225 million next year.
Funding for public education is down 2.9% from fiscal 2010, with a 3.3% reduction for higher education.
Revenue enhancements for fiscal 2011 include a highway camera system that would allow the state to ticket motorists who drive without car insurance. Treasurer Scott Meacham said revenue from the program is estimated at $50 million a year.
Officials expect to generate $36 million by collecting sales tax on Internet and catalog transactions, and $78 million through a 1% fee on insurers on health care claims. Revenue from the insurance fee is dedicated to the state’s Medicaid program, and will be matched by the federal government with $3 for every $1 from the state.
House Speaker Chris Benge, R-Tulsa, said the budget agreement was “a true product of consensus,” and predicted passage of the revenue measures needed to balance the fiscal 2011 budget.
“This budget represents the tough decisions we have said all session would be required to fill a $1.2 billion shortfall, which inevitably will touch every aspect of state government,” Benge said.
“We believe this is a fiscally prudent budget that will help our state continue to weather this economic downturn with the hope that revenues will stabilize as the economy improves,” he said.