HB2789 appropriates a total of $9,925,661.48 from Oklahoma’s Statewide Recovery Fund to the Oklahoma Water Resources Board. The money is directed to two purposes: $3.3 million to cover increased costs for a project funded in Section 7 of Senate Bill 13 from the 2nd Extraordinary Session of the 58th Legislature, and $6,625,661.48 to complete projects that did not receive funding under the grant programs described in Sections 2 and 3 of that same Senate bill. The bill ties both appropriations to recommendations adopted by the Joint Committee on Pandemic Relief Funding on May 12, 2025.
The bill also creates special Statewide Recovery accounts for the Water Resources Board, allows the Board to request transfers into those accounts, and requires the Office of Management and Enterprise Services to complete the transfer within seven calendar days. It authorizes the Board to enter memorandums of understanding with other state agencies for auditing, documentation, implementation, oversight, reporting, and management, but bars any agreement that would transfer or relinquish the Board’s control over the funds. The Board may also contract with financial institutions and adopt rules or procedures to administer the funds, so long as those rules do not conflict with the act.
HB2789 limits administrative retention to no more than 4% of the appropriated funds, and only for costs tied to administration and programming of the funds, while prohibiting retention of amounts that would be disallowed under the American Rescue Plan Act of 2021. The bill requires quarterly reporting to legislative leaders or the designated committee, including copies of any MOUs and third-party contracts, and it requires the Board to appear before the Joint Committee on Pandemic Relief Funding upon request to provide implementation updates. The special accounts and reporting obligations remain in effect only while the ARPA-related monies are being budgeted, expended, or managed, as determined by the State Treasurer.
The overall sentiment appears strongly supportive and largely noncontroversial. The bill passed the House committee stage unanimously, passed the Senate Appropriations and Budget Committee unanimously, and advanced on third reading with substantial majorities in both chambers, though the Senate third reading vote included eight nays. The emergency clause and immediate effective-date structure suggest lawmakers viewed the funding as time-sensitive and necessary to keep water-related recovery projects moving.
The main points of potential contention are administrative control, oversight, and the use of federal recovery funds. The bill carefully preserves the Water Resources Board’s authority over budgeting and spending while allowing coordination with other agencies, which indicates sensitivity to concerns about outside control. The reporting requirements, 4% administrative cap, and ARPA compliance language also suggest an effort to address scrutiny over transparency, allowable costs, and whether the funds are being used strictly for eligible recovery purposes.
HB2789 changes state fiscal administration by directing nearly $10 million in Statewide Recovery Fund money to the Oklahoma Water Resources Board and by creating temporary special treasury accounts to hold and manage those appropriations. It imposes specific transfer, reporting, and administrative rules on the Board and the Office of Management and Enterprise Services, and it limits how much the Board may retain for administrative costs. The bill does not amend a permanent codified statute, but it establishes noncodified funding and oversight requirements that govern the use of these recovery dollars until the related ARPA funds are fully managed.
The bill’s legislative history shows broad bipartisan support and little visible opposition in committee, with unanimous committee votes and strong floor passage in both chambers. The presence of an emergency clause and immediate effectiveness language indicates a sense of urgency around completing water infrastructure or grant-related projects. The smaller number of nays on final floor votes suggests some members may have had reservations, but the overall sentiment was favorable.
The most notable issues are not about whether to fund the projects, but about how the money is controlled and monitored. The bill preserves the Water Resources Board’s authority over the funds while allowing interagency support through memorandums of understanding, which may reflect concern about preserving agency autonomy. Another likely area of attention is compliance with federal ARPA rules, since the bill caps administrative retention at 4% and expressly forbids disallowed costs. Oversight requirements to report quarterly and appear before the Joint Committee on Pandemic Relief Funding also indicate legislative concern about transparency and accountability.