A measure to raise the cap on the Rainy Day Fund passed the Senate Monday. Senator David Holt’s Senate Joint Resolution 44 asks voters to approve basing the cap for the savings account on a more realistic accounting for the budget. While lawmakers usually have between $5.5 to 7.1 billion to use for appropriations, state spending totals about $24 billion.
The current 15 percent cap is based on the funds available for legislative appropriations.
Holt contends the state has been through enough highs and lows related to the oil and gas industry, it should take action to prevent a down cycle from creating a budget crisis. Lawmakers are attempting to make up for a $1.3 billion gap mostly due to a major drop in oil and gas prices.
“We’ve lived in an energy-based economy long enough to know these price drops are going to happen and we need to have a savings account that is adequate to the task,” said Holt. “Out of this current budget crisis, I can think of no greater gift we can give future generations than to put a savings plan in place that will give us the security we need to avoid future shortfalls like this. The lessons we’re learning in this crisis need to be applied today, while they are fresh. Putting an appropriate cap in place is the first step. The current cap is measured against a dollar amount that has no particular relevance, it provides a false sense of security, and it has utterly failed us.”
It is now the House of Representatives turn to handle SJR 44.
