“The governor continues to move the needle on income tax reduction,” Doerflinger said. “We know that every time we sustained cuts in the income tax since 1998 that we have seen additional revenue come in as a result of that, that generally far exceed the cost of the cut itself.”
Fallin's plan calls for it to be paid out of available revenue. It is not dependent on reducing or eliminating any tax credits or exemptions or deductions as her proposal a year ago was. It's expected when fully implemented in the 2015 fiscal year, it would cost the state about $120 million annually.
Doerflinger said the governor would welcome any effort by lawmakers to reduce or eliminate unnecessary tax incentives and produce a bigger cut in the personal income tax rate.
Fallin's budget does not call for a $2 million appropriation to the Agriculture, Food and Forestry Department, which is the subject of a lawsuit. Lawmakers and the governor last year approved giving the agency $2 million, which went to the youth expo junior livestock show, an annual Oklahoma City event. Rep. Mike Reynolds, R-Oklahoma City, has filed a lawsuit claiming that the spending and associated actions violate the state constitution in a variety of ways, including a constitutional ban on making gifts of public money.
Other budget items
Fallin, during her State of the State speech Monday to lawmakers, defended her earlier decision to not accept federal money to expand the state Medicaid system. Her budget calls for an additional $40 million to pick up Medicaid costs for about 61,000 Oklahomans who are eligible for Medicaid but are not enrolled in the health care program.
Fallin also is seeking an additional $16 million for state mental health services, which would be used to pay for a third community crisis center in the state and beef up funding of programs intended to reduce suicide and prescription drug abuse. She also wants money to go to a program that helps children and families with children who are suffering serious emotional issues.
She also is seeking $46 million of new money to pay for recommended changes in a five-year plan to improve child welfare operations at the Department of Human Services. The plan is part of an agreement to settle a federal lawsuit.
Fallin's budget also seeks a $13.5 million increase to public schools to pay for recently enacted changes. Earlier changes approved but not funded by lawmakers include better reading instruction and end-of-high-school exams in public schools.
State prisons fell short of their request. The governor's budget calls for an increase of $1 million; Prisons are at 99 percent capacity and the Corrections Department sought an additional $66.7 million in the next fiscal year to help deal with a growing offender population and to attract and retain correctional officers.
Fallin is proposing about $20 million be appropriated immediately from about $125 million in funds available this fiscal year. She is seeking $10 million for the nearly 100-year-old Capitol: $8 million to repair the crumbling limestone exterior and $2 million for a study to develop a plan to repair and renovate the building.
The governor also is seeking $8.5 million to pay for teachers' health benefits. Actual cots have risen because of increases in the number of teachers and support staff as well as increasing costs to provide their benefits.