The monthly revenue release from the State Treasurer’s Office brought bad news for state agencies Tuesday afternoon. Revenue collections for July, the first month of the new fiscal year, are well below prior year collections and the official estimate. The shortfall is great enough that state officials have ordered an across-the-board budget cut in budget allocations to all state agencies this month.
Preliminary reports for collections in the month of July show General Revenue Fund collections totaled $336.7 million. That amount is:
* $120.4 million or 26.3 percent below the prior year; and
* $74.4 million or 18.1 percent below the estimate.
July was the seventh month to show revenues below the estimate.
In response to the shortfall, State Finance Director Michael Clingman has ordered a five percent across-the-board reduction to each state agency’s allocation in the month of August. According to Clingman, the cuts would have been deeper, but the impact was minimized by utilizing $54 million in cash reserves.
Treasurer Meacham said he is meeting with Governor Henry and legislative leaders to discuss options for the coming months.
“We have several options. These include potential use of the Rainy Day Fund, tapping additional federal stimulus money and other responses,” Meacham said. “However, I would warn state agencies that additional cuts may very well be coming.”
Reporters asked whether the cuts would mean furloughs and reductions-in-force for state employees.
"Agencies that are already tight will be even tighter," said Meacham. "However, we hope they will give the governor and legislative leadership a few weeks to make a game plan as to what we are facing."
For several months, OPEA has been calling for state agencies to cut contracts and discretionary spending, including travel.
“These are challenging times,” said OPEA Executive Director Sterling Zearley. “State agencies should be doing all they can to save. Out-of-state travel, conferences, and new equipment purchases should be postponed for better times. Scarce funds are needed to maintain state jobs and services to the people of Oklahoma.”
“Before considering furloughs or reductions-in-force (RIFs), state agencies should cut contracts,” continued Zearley. “Contractors are partners with the state of Oklahoma and should share in the bad times.”
OPEA is also calling on members to become more involved in identifying cost saving measures in their agencies.
“No one is more equipped to help agencies conserve resources than those who are on the front line serving the public,” said Zearley. OPEA members should e-mail any ideas to Trish Frazier at trishf@opea.org.
In addition, members should be recruiting and holding meetings in their offices to discuss budget options.
“These are challenging times for state employees,” concluded Zearley. “The revenue situation could get worse before it gets better. The best protection for state employees is to be a member of OPEA. The more members, the stronger our voice and power to fight to maintain state jobs and services.”
Posted on
Tue, August 11, 2009
by Trish Frazier