ODMHSAS Turns the Corner: Financial Stability is in Reach After a Decade of Overspending

The Oklahoma Department of Mental Health and Substance Abuse Services (ODMHSAS) is stabilizing its finances after a decade of overspending and weak financial controls. Under the leadership of Interim Commissioner Greg Slavonic, the agency has completed a four-step overhaul.

ODMHSAS reduced 23 executive positions, saving $3.5 million annually, and non-essential and redundant vendor contract items were not renewed, saving millions more. Grant programs were audited for sustainability after federal projects and funds ended while IT systems were assessed to identify gaps.

The agency also reformed its contracting process, ending the misuse of sole-source agreements that bypassed competitive bidding. Going forward, ODMHSAS will use open Requests for Proposals to ensure fairness and better value for taxpayers.

Slavonic acknowledged that reducing or restructuring clinical contracts has been one of the most sensitive challenges. “Every program has a personal story behind it,” he said. “We understand how much peer support and community services mean to the people they’ve helped. But our responsibility is to fund programs that align with our behavioral health mission, meet statutory requirements and stay within the budget provided by the Legislature.”

These actions brought spending in line with the agency’s estimated $589 million FY26 budget. However, the agency continues to receive invoices from FY25, a remnant of past practices where current-year funds were used to cover prior-year expenses—an approach that kept operations running but obscured the true financial picture.

The department’s FY26 baseline budget includes $403 million in state funds, $57 million in federal funds and $128 million in revolving funds. The FY27 budget request maintains this operating level but totals $668.8 million, including a $79.5 million incremental for technology upgrades ($22.5 million), consent decree costs ($17 million) and additional Title XIX funding for FY26 and FY27 ($40 million).

The next phase of reform focuses on long-term prevention and sustainable operations. The FY27 incremental requests include $22.5 million toward critical IT infrastructure, including a unified digital medical record and financial accounting system. These upgrades will close long-standing gaps in financial tracking, improve reporting and accountability, and help ensure the agency manages funds transparently and effectively.

“Stabilizing the budget was one of my top priorities, but it’s only part of the story,” Slavonic said. “Reorganization, transparency and meeting our consent decree milestones are equally important. We’re proving that good stewardship and good care go hand in hand.”


A foundation for accountability

ODMHSAS continues to work closely with state auditors, legislative leaders and the governor to ensure every reform is measurable and sustainable. The agency’s financial recovery marks a major turning point toward restoring confidence in one of Oklahoma’s most critical public service systems. None of this progress would be possible without the resilience of dedicated ODMHSAS staff, who have continued to deliver essential care and support to Oklahomans through a period of major change.

“Our mission is clear,” Slavonic said. “We are here to serve Oklahomans struggling with mental health and addiction challenges. The best way to honor that mission is by managing taxpayer dollars wisely and transparently. That’s exactly what we’re doing.”

* Revolving funds include direct care payment from Medicaid, Medicare, private payers, and self-pay, as well as funds from ABLE and other funding streams not included in state or federal allocations.