Fallin orders agencies to plan for 10% budget cuts

Gov. Mary Fallin has issued an executive order for the head of every state agency, board and commission to come up with written plans to reduce spending by 10 percent for the rest of this fiscal year and for the next fiscal year.

Fallin said the executive order does not mandate any spending cuts; rather, it asks agency heads to plan for potential future cuts.

The plans are to include an explanation of how the dollars saved from the reduction will be reallocated to other needs within the agency. The written spending cut plans are due to each agency’s respective Cabinet secretary by December 1, according to Executive Order 2015-46.

The governor also placed a moratorium on nonessential, taxpayer-funded, out-of-state travel for all state employees. Essential travel is limited to trips that are critical to core state agency functions, maintain professional accreditation unavailable in Oklahoma, are required by the federal government or are necessary to secure or maintain federal funding.

Also, effective Dec. 1, advance written notification must be given for proposed state payment of any:

  • Agency, state and public employee or officer membership(s) in any private or public organization;
  • Nonessential out-of-state travel for agency employees and officers that is wholly paid for by an entity other than the state, or;
  • Nonemergency purchase(s) that exceed $10,000.

“I’m asking every agency to start planning for potential spending cuts and to develop a strategy that protects essential services,” said Fallin. “It’s important we get ahead of this issue as we enter a difficult budget year. Families and businesses tighten their belts during lean times; our state agencies can do the same.”

The shortfall for the last state budget was $611 million and some estimates for the next fiscal year top $1 billion. Revenue for the appropriated state budget for the 2016 fiscal year has come in below projections.

Fallin filed another executive order directing state agencies to dispose of any underused property and buildings to generate revenue to pay for the maintenance of state buildings and help offset projected state revenue shortfalls. Her order includes undeveloped land as well as unused or underused office buildings, warehouses and residences.

Agencies have successfully identified and sold unused or underused assets in the past. For example, in July of this year the Department of Human Services sold the former Laura Dester Center property to the city of Tulsa for $955,000. Half of the buildings on the campus were considered underutilized; annual savings as a result of selling those underutilized buildings and not having to pay for such things as maintenance, utilities and landscaping is estimated between $50,000 and $63,000.

“Disposing of underutilized property will reduce costs and ensure our taxpayer dollars are going towards the core government services that Oklahomans rely on,” said Fallin. “That is especially important as we approach what we know will be a tough budget year.”

Selling underutilized property also will help local governments, she said. Properties sold to private purchasers will be placed on local tax rolls.

In most cases, proceeds from the property sales would go to the Maintenance of State Buildings Revolving Fund.