New budget will provide for replenishing reserves
Last week the House, Senate and governor came to an agreement on a budget for Fiscal Year 2022. It is currently making its way through both House and Senate committees, but I wanted to give you a few highlights in my weekly column.
The proposed budget maintains all state core service funding, provides tax relief to individuals and businesses, and makes targeted new investments in key priorities like education, economic development, health care and infrastructure. It will also restore more than $700 million in state reserve funds that were used to offset pandemic-related revenue issues last year.
The specific details are still being finalized, but some of the highlights are:
The new budget increases common education funding by $171.8 million, or 6%, to a record high of $3.2 billion, triggering class-size reductions in kindergarten and first grade. Studies have shown that class-size reductions in a student’s formative years lead to increased success and better outcomes later in their educational career. This is a huge benefit for our students and teachers.
The new budget also boosts reserves from less than $300 million today to more than $1 billion – approaching the high-water mark state reserves held before the pandemic began. Our state’s ability to save money for a rainy day helps us be prepared for any circumstance we might face. I’m glad that we are able to replenish our reserves.
The new budget expands broadband in underserved and unserved areas statewide through a $42 million tax incentive for providers. Broadband access, especially in our rural areas, is critical to our future success and growth. This investment will help us attract new businesses and increase educational and technological opportunities for all areas of our state.
The new budget aggressively recruits jobs to Oklahoma through $35 million in new economic development funding. We want to keep our young people in Oklahoma after they graduate, and one way to do that is to make sure we have high-quality jobs for them to obtain. Continuing to invest in economic development for our state today will help secure the future we want to see tomorrow.
Additionally, the new budget restores historic sales tax credit allowing University of Oklahoma Health to train 160 additional nursing graduates and nurse practitioners annually and 70 additional medical residents within three years. One thing we can never have too much of are well-trained health care professionals. We need to attract more of these individuals to our state and make sure they are receiving the training they need.
Legislation containing the agreement has begun progressing through the legislative Joint Committee on Appropriation and Budget. The general appropriations bill will be House Bill 2900.
The budget was built on the Board of Equalization’s February certification of $9.6 billion in revenue available for appropriations. Of that figure, the agreement spends $8.3 billion and allocates the rest to tax relief, replenishing reserves or replenishing off-the-top funding temporarily redirected during the pandemic last session.
Finishing the budget will be our primary focus over these last two weeks. The constitutional deadline for adjournment of the legislative session is 5 p.m. Friday, May 28.
That’s it for now. If I can help you with anything, feel free to call my Capitol office at 405-557-7355 or email me at email@example.com.