State Budget Practice Report Cards and Budget Resource Guide
Oklahoma was one of only eight states receiving a top A average in legacy costs for fiscal 2016 through 2018. Unlike neighboring Texas, which posted a D-minus in the category, Oklahoma has made at least 100 percent of the actuarially determined contribution to its public worker pension plans since 2014.
It also earned an A average in reserve funds. Oklahoma has a constitutional mandate governing the replenishment of the rainy day fund. It requires that collections exceeding the Board of Equalization’s itemized estimate of general revenues be deposited into the Constitutional Reserve Fund each year until the balance equals 15 percent of the prior fiscal year’s general fund. It also spells out how the reserve fund can be used. The board—an independent body—is made up of the governor, lieutenant governor, treasurer, and attorney general, and several other officials.
The state’s B average in budget maneuvers reflects repeated transfers of money into the general fund from special funds to create a balanced budget. For instance, the state moved $293 million into the general fund in 2018. Such one-time actions to cover recurring expenditures may not be sustainable.
Oklahoma also averaged a B in budget forecasting. While it used consensus revenue estimates and multiyear forecasts for revenues and expenditures, the state did not provide a rationale for its revenue growth projections. The legislature’s Appropriations Report and the state’s comprehensive annual financial report both say that revenue forecasts are adopted by the state Board of Equalization, but neither explains the forecasting process.
To emphasize the need for clear and comprehensible budgets to inform citizens, promote responsible policymaking, and improve fiscal stability, the Volcker Alliance in 2016 began a study of budgetary and financial reporting practices of all fifty states. The Volcker Alliance’s mission is to improve the effectiveness of the administration of government at all levels. Making state budgeting more transparent and accountable is an important part of that goal.
The report cards found here contain grades of the state's budgetary practices during the fiscal years of 2016 through 2018. Each state received marks in five critical categories, based on their adherence to best practices in several key budgeting indicators. The five categories covered methods used to achieve budgetary balance as well as how budgets and other financial information are disclosed to the public.
States received grades of A to D-minus (there are no “failed states”) for their procedures in estimating revenues and expenditures; their use of one-time actions to balance budgets; how they oversee and use rainy day funds and other fiscal reserves; the adequacy of their funding of public worker retirement and other postemployment benefits; and the quality of transparency of budget and related financial information. The grades are based on research conducted by public finance and budgeting professors and students at eight US schools of public administration or policy. The universities’ research efforts were augmented by Volcker Alliance staff, data consultants at Municipal Market Analytics, and special project consultants Katherine Barrett and Richard Greene.
State Budget Sources
State Budget Sources: An Annotated Guide to State Budgets, Financial Reports, and Fiscal Analyses is a resource published by the Volcker Alliance designed to help public officials, policy advocates, journalists, academics, and concerned citizens fully understand the critical fiscal decisions that governors and legislators must make. The guide includes the links below to budgets for this state as well as legislative analyses of budget bills and treasurers’ or comptrollers’ monthly state cash-flow statements; capital spending plans; reports on public-worker pension funding and returns; and reports by local and national fiscal research organizations, bond rating firms, and associations of state fiscal and finance officials.