Oklahoma Republicans tout proposed $12.6 billion budget deal

Yahoo

15-05-2025

Gov. Kevin Stitt announces a budget deal for the 2026 fiscal year on May 14, 2025. Senate Pro Tem Lonnie Paxton, R-Tuttle, left, and House Speaker Kyle Hilbert, R-Bristow, right, and other legislative leaders joined the governor for the announcement at the state Capitol. (Photo by Emma Murphy/Oklahoma Voice)
OKLAHOMA CITY – Gov. Kevin Stitt and legislative leaders on Wednesday announced an agreement on a $12.6 billion state budget for the upcoming fiscal year that contains a tax cut, increased education spending and money to purchase a prison.
Republican leaders praised the budget deal, with one legislator calling it the smoothest negotiations he'd seen in seven years.
Democrats, though, expressed doubts that the deal benefits Oklahoma residents.
The proposed tax cut, which drops the state's top income bracket to 4.5% from 4.75%, comes after years of calls from Stitt. The Republican had faced roadblocks from lawmakers within his own party, who feared it could harm state coffers in bad revenue years.
It also reduces the number of tax brackets from six to three.
'It stays in people's pockets to be able to be spent how they see fit,' Stitt said.
The plan calls for triggers to further reduce the top bracket when revenue hits a certain target. Most Oklahomans fall within the top bracket.
A family of four with an income of $50,000 would save about $137 a year, according to Senate staff.
'That's going to be very, very significant for a lot of families,' Stitt said.
He said the cut is needed so Oklahoma can be competitive with other states.
The budget agreement keeps most state agency allocations flat. However, it includes a 3.15% increase in public school funding, but a nearly 8.8% decrease in CareerTech funding, according to the Oklahoma State School Boards Association. Public schools will get $3.98 billion, up from $3.86 billion, according to the association.
Some other agencies are slated to receive strategic investments for special projects.
Some $200 million will go to construct a University of Oklahoma pediatric heart hospital, said House Speaker Kyle Hilbert, R-Bristow.
Another $250 million is allocated to the Oklahoma State University College of Veterinary Medicine in an effort to increase the number of animal doctors in the state, Hilbert said.
'It has not been taken care of and it should be an absolute gem for the state of Oklahoma,' Hilbert said.
The state also plans to buy the private prison in Lawton for $312 million. The facility currently houses about 2,300 Oklahoma inmates.
The budget keeps about $3.5 billion in state savings, Hilbert said.
Senate Appropriations Chairman Chuck Hall, R-Perry, said the budget allocates funding to address deferred maintenance at state facilities.
It also calls for a $26 million supplemental appropriation for the financially troubled Oklahoma Department of Mental Health and Substance Abuse Services.
In addition, it gives the agency some funds to finance the provisions of a settlement agreement that the state entered into after being sued for not providing competency restoration services to inmates awaiting trial, said Trey Caldwell, R-Faxon, the House Appropriations and Budget Committee chairman.
On the policy side, Republicans said they agreed to create business courts, which are specialized courts that handle commercial litigation matters. They also said they've agreed to reform the state's workers' compensation system and lawsuits.
Under the proposed tort reform, lawmakers are expected to propose a cap on damages for pain and suffering, called non-economic damages. A prior cap was deemed unconstitutional.
The bills are being drafted and will run through the legislative process, officials said.
Hilbert said it was the seventh year he has been involved in the budget process.
'I would say it to me it feels like the smoothest year in terms of budget negotiations amongst the three stools of the House and Senate and governor,' Hilbert said.
Senate Minority Leader Julia Kirt, D-Oklahoma City, said her party was left out of the process and has some deep concerns about the budget.
She said the budget has priorities for big business and corporate giveaways, but doesn't prioritize people and services.
'We don't believe this budget prioritizes people,' she said.
Lawmakers must pass a budget before 5 p.m. May 30.
Reporters Emma Murphy and Nuria Martinez-Keel contributed to this report.
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