'Fiscal cliff' deal to have minor but immediate effect on Oklahoma's state budget

Oklahoma's projected revenue for the next fiscal year is expected to drop by about $50 million in personal income tax collections because the legislation calls for generally lower income tax rates.
BY MICHAEL MCNUTT mmcnutt@opubco.com Published: January 3, 2013

Oklahoma budget officials projected that the federal “cliff,” or sequestration, could result in the state losing $137 million in direct federal funding as a result of automatic, governmentwide spending cuts that were to take effect Jan. 1.

Estus said it's unknown whether Oklahoma will still lose federal funds because the sequester was delayed by two months.

“But for now, no federal funds have been lost,” he said.

Gov. Mary Fallin believes the last-minute compromise reached by Congress and the White House to avert the “fiscal cliff” amounts to a short term, Band-Aid solution to the country's long-term revenue and deficit problems, a spokesman said.

“While she is happy that tax increases were avoided for the majority of Americans and Oklahomans, the deal does nothing to address unsustainable entitlement spending or government waste,” said Alex Weintz, Fallin's communications director. “Furthermore, the short-term and last-minute nature of the compromise continues to add uncertainty and instability to the economy, hampering economic growth.”