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Revenue failure expected to be $416 million, Gov. Stitt says, as COVID-19 shatters the rest of FY2020

Revenue failure expected to be $416 million, Gov. Stitt says, as COVID-19 shatters the rest of FY2020

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Oklahoma State Capitol

Lawmakers are to return to the Capitol on Monday to address the governor's state of emergency declaration. Dave Morris/The Oklahoman file

OKLAHOMA CITY — Gov. Kevin Stitt on Friday said the state expects a $416 million revenue failure for the remainder of fiscal year 2020, which ends June 30.

The figure is higher than initial reports that put it around $219 million.

“This revenue failure is not unexpected given the significant impacts of the COVID-19 pandemic as well as the dramatic downturn in the oil and gas markets,” Stitt said. “Times like these further reinforce how critically important it was for our House and Senate leadership to work with me to save an additional $200 million during last year’s budget surplus.”

Under normal circumstances, this revenue failure would automatically result in 6.2% budget cuts to all state agencies.

Stitt, however, said he expects to fill this year’s shortages with money from the state’s reserves, which total just over $1 billion.

The state will also be receiving federal money as a result of last week’s coronavirus relief bill.

Stitt has called for a special virtual meeting of the Board of Equalization at 1 p.m. Monday to begin to tap into the state’s savings account.

The state of Oklahoma’s Rainy Day Fund currently has a balance of $806 million, up to $302 million of which is constitutionally available to the Legislature to supplement the FY20 budget. Additionally, due to the governor’s declaration of an emergency, the Legislature is authorized to access an additional 25% of the Rainy Day Fund, or $201 million.

Stitt and his administration have been in communication with House and Senate leadership and are working on ways to mitigate any potential cuts to state agencies.

“When our health department officials, public safety workers, emergency responders and so many others are working tirelessly to help the people of Oklahoma, I want everyone to know that we will prioritize protecting our core services for dealing with the COVID-19 crisis,” Stitt said.

“As the last few weeks have demonstrated, it will take time to fully understand the impact COVID-19 will have on our state revenue. We must be very cautious and remain fiscally prudent to restrain spending as we work with the Legislature on next year’s budget.”

Lawmakers are expected to return to the Capitol on Monday to take up the issue and approve Stitt’s health emergency declaration, which gives him additional powers during the crisis.

House Majority Leader Jon Echols, R-Oklahoma City, said he thinks the issue can be resolved in one day with three to four bills, but that is subject to change.

At least three staffers and two lawmakers have tested positive for COVID-19. Last month, lawmakers limited access to the building to elected officials, essential staff, invited state employees and the press.

Lawmakers will be taking precautions when they return to the facility, which recently underwent cleaning. Echols said they will be practicing social distancing.

Echols said lawmakers will be brought into the chamber in small groups. He said the process will be slow. In addition, lawmakers who have symptoms, tested positive, live with someone who is positive or immune comprised, will be asked not to enter. In addition, those with a temperature of 100.4 Fahrenheit or greater, will be asked not to enter.

The House is allowing voting by proxy under a rule adopted last month.


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Barbara Hoberock 405-528-2465

barbara.hoberock

@tulsaworld.com

Twitter: @bhoberock

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