Editorial
The Oklahoman
THE National Association of State Budget Officers noted in a recent report that many states are in a similar situation fiscally. They have “limited resources with numerous demands for spending and not enough revenue to go around,” NASBO said.
Oklahoma feels their pain. Agency directors go to the Capitol each year to (almost always) ask lawmakers for more money. Whenever they can, lawmakers try to oblige. This has been the practice for decades, although since the Great Recession most agency heads have seen their budgets shrink a bit, or perhaps be held steady.
It’s a flawed system. When times are good, the Legislature writes bigger checks. When they’re not so good, the checks get smaller. A question asked all too infrequently is whether the state is getting its money’s worth.
Oklahoma will begin asking that question more often, as it joins several other states in moving toward “performance-based budgeting.” This process — using specific measures of past performance to determine whether a budget item is worth the money — gained popularity in some states in the 1990s, but was pushed aside after the recession to focus on navigating the fiscal minefield.
Now it’s back, including in Oklahoma. The state’s budget office in January began implementing a new budgeting system that went live a few weeks ago. It’s intended to allow the state to move toward what Preston Doerflinger, state finance secretary, calls “performance-informed budgeting.”
“It will allow us to look across state programs throughout the state,” Doerflinger says. “We have agencies that are trying to solve the same problem, and at times may even be competing with each other to try to do it. This will allow us to make better informed decisions about programs that are successful.”
He used the issue of teen suicide as an example. Several state agencies are involved in trying to address it. Are particular programs having the greatest impact? If so, that should be evident and thus make it easier for budget appropriators.
“It makes perfect sense that we would approach budgeting this way,” Doerflinger said.
NASBO surveyed states that have used performance-based budgeting and said there are important factors to consider. One is that buy-in from agency managers is a must, because elected and politically appointed officials come and go. This system of budgeting “creates a level of uncertainty that will be unsettling to many of the key employees expected to implement the process,” NASBO said. Doerflinger says he’s witnessed some of that uneasiness here as the change has been made.
Budget officers in other states also said it’s important for state leaders to push and support the idea and for agencies to see the benefits in performance-based budgeting — upsetting the status quo can be difficult. And, this sort of budgeting can’t simply be a budget-cutting exercise. “The focus should be on how the process directs investment of scarce resources toward more effective programs,” NASBO said.
The organization found that although performance-based budgeting practices are increasing, “the process of actually tying performance information to funding decisions in an effective, meaningful and practical manner continues to be a major challenge for all levels of government.”
Doerflinger, however, says Oklahoma’s practice for years “is the definition of insanity — doing the same thing year in and year out and expecting a different result.” This new way of budgeting, he believes, can transform the state for the better.
“I’ll keep talking about it until I’m blue in the face,” he said. And he may have to, in order to get this particular aircraft carrier turned around. We wish him well. Taxpayers should too.
I bet if we stopped cutting taxes to the top income brackets and insisted that Oil and Gas pays the tax that is written into law without giving them back most of it we would have more revenue. If we would pay people a living wage then we would have more revenue: more income, more income taxes, more income, more spending, more income, more people able to go without food stamps or welfare.