Following is an excerpt from OCPA’s Proposed State Budget for the Fiscal Year ending June 30, 2013.

With Oklahoma government spending at an all-time high (see chart), the time has come to set priorities and to exercise spending discipline.

The most significant driver of state spending growth is federal funds, or what tax consumers like to think of as “free” money. It is the federally induced welfare programs, such as Medicaid, that require ever-increasing state funding matches for the programs’ exploding costs. According to Oklahoma’s latest Comprehensive Annual Financial Report (CAFR), total state spending on social services has grown from $1.59 billion in FY 2005 to $2.25 billion in FY 2011—an increase of 41.7 percent in six years. Total state spending on health services has grown from $3.13 billion in FY 2005 to $4.85 billion in FY 2011—an increase of 54.3 percent in six years.

Based on this enormous growth, lawmakers must take a serious look at state programs operated with federal funds. In particular, oversight of state agencies’ application for federal funds, and operation of programs using federal funds, must begin immediately.

The current budget-review process is inadequate. There are simply too many programs being operated by state agencies, and too much money being spent. Just as lawmakers have established committees specifically for certain policy issues needing intense review (e.g., DHS), it is time to form an oversight committee designed specifically to review and make recommendations for all state programs utilizing federal funds.

The unchecked growth in state-government spending—a bipartisan problem—is irresponsible. It is time for policymakers to take fiscal federalism seriously, and to chart a new course towards economic freedom.

Submitted each year by the Oklahoma Council of Public Affairs, Inc. to the taxpayers of the State of Oklahoma and their elected Officials, the OCPA “Budget Book” is carefully crafted by Fiscal Policy Director Jonathan Small to help lawmakers set priorities and exercise spending discipline while creating a state budget that respects your family budget. Offering unmatched fiscal policy analysis and recommendations, Small draws on his experiences as a former budget analyst for the Oklahoma Office of State Finance, former fiscal policy analyst and research analyst for the Oklahoma House of Representatives, and former director of government affairs for the Oklahoma Insurance Department to provide perspective on the state budget that you cannot find anywhere else.