OKLAHOMA CITY — Oklahoma Mental Health Commissioner Allie Friesen faced intense scrutiny Thursday from a bipartisan House committee regarding a significant budget shortfall within the Department of Mental Health and Substance Abuse Services (ODMHSAS). The committee, which was formed earlier this week, convened to investigate the agency’s finances, contract terminations, and funding gaps.
State Representative Mark Lawson, R-Sapulpa, who chairs the committee, opened the session by emphasizing the committee’s purpose: to examine the department’s financial status and inform upcoming appropriation decisions. “Our goal is to understand the department’s financial position so we can make informed decisions about funding,” Lawson said.
Friesen told lawmakers that the department is currently facing a $43 million shortfall. She revealed that she became aware of the shortfall and issues surrounding Title XIX funding for the 2025 fiscal year about six weeks ago. In response, the department has submitted a $6.2 million supplemental appropriation request for FY 2025 to address its financial obligations.
“The reality is that it’s chaotic,” Friesen admitted. “We’ve been through a challenging time, but we’re working to get to a much more stable and confident place.” She attributed the delay in addressing the issue to the department’s leadership changes, explaining that the agency had “parted ways” with some of its previous leadership in December 2023, which caused a need to start from scratch with new data.
Friesen emphasized that the agency is working diligently to rebuild trust with the state legislature.
Contract Terminations Spark Concerns
Much of the committee’s questioning focused on the agency’s recent contract decisions. Friesen acknowledged that the agency had made a mistake in terminating a $250,000 contract for Community Outreach Psychiatric Emergency Services (COPE) in Tulsa. Additionally, she confirmed that contracts with three Certified Community Behavioral Health Clinics (CCBHCs) had also been canceled.
Friesen explained that the agency had absorbed the services provided by the COPE contract into its internal operations to ensure service continuity. “We will negotiate with them for an FY 26 contract,” she added, noting that the agency had issued a new Request for Proposals (RFP) on Wednesday for the same services. She assured the committee that there would be no cancellations of contracts until the new RFP is awarded, allowing CCBHCs in Tulsa to continue operations.
Ongoing Investigations and Employee Concerns
The department’s financial and operational challenges have drawn considerable attention, including multiple investigations into the agency’s practices. Gov. Kevin Stitt announced a formal investigation into ODMHSAS’s finances and contracting procedures earlier this week. Additionally, the state’s Inspector General’s Office is conducting its own investigation into the agency’s activities.
Friesen explained that, due to the sensitive nature of these ongoing investigations, she had requested that employees sign non-disclosure agreements to prevent leaks of information from the department’s administrative offices. “We’ve had instances of information leaving our offices,” she noted, underscoring the need for confidentiality.
The commissioner also reported that some employees have received death threats amid the department’s scrutiny. “We need to be careful about what we say and what we don’t say,” Friesen said, highlighting the difficult environment in which the agency is operating.
Next Steps and Committee’s Focus
By the end of Thursday’s meeting, the committee had not yet reached any conclusions, though 11 speakers were scheduled to provide testimony after Friesen. Rep. Lawson emphasized the need for clarity on whether any funds allocated by the legislature were unaccounted for and stressed that the legislature needs greater confidence in the funding process for mental health services.
“This is an all-hands-on-deck approach as we near the end of the legislative session,” Lawson said, indicating that the committee’s efforts are crucial for shaping both short- and long-term funding strategies for the state’s mental health services.
As investigations continue and the legislative session advances, it remains to be seen how the department will address its financial shortfall and the ongoing concerns over its contracts and management practices.
