The Oklahoma legislature’s special session continues, as a compromise bill failed in the Oklahoma House of Representatives. Lawmakers nearly agreed to increase taxes on beer, tobacco and fuel, and were close to a deal on raising taxes on oil and natural production, which has been a major point of contention throughout the special session. The tax package required 76 votes in the House, but fell 5 votes short.
Some Republicans who voted against the bill argued it would hurt an important industry, saying lawmakers should focus on wasteful spending by state agencies. Democrats who voted against the package said it didn’t tax Oklahoma oil and gas companies enough.
Next week will be lawmaker’s eighth week of special session, working to fill OKlahoma’s $215 Million budget hole.
Dick Pryor: This is Capital Insider, an insider look at Oklahoma politics and policy, coming up on week 8 of the legislative special session.
Governor Mary Fallin (Tape): If the legislature makes draconian cuts to these state agencies, I won't be for that... We'll stay. I've told them a little while ago, I'll stay till Christmas.
Dick Pryor: I'm Dick Pryor with the eCapitol news director Shawn Ashley. Shawn, a big push to pass revenue raising measures to fill the state's budget hole and begin placing the Oklahoma government on a more stable financial footing fell five votes short. So to recap, legislators need to find $215 million to balance the budget. An extra $30 million that needs to go immediately to the State Department of Health. In seven weeks, what have they accomplished?
Shawn Ashley: One bill has made it through both chambers. A bill appropriating $23.3 million to the Department of Mental Health and Substance Abuse services. Governor Mary Fallin signed that bill. So the department will be getting that money. That agency received $75 million from the tobacco cessation fee. So this is only about a third of the money that they needed to make up the shortfall that one agency was experiencing. The other agencies thus far have not seen any help whatsoever in addressing the situation.
Dick Pryor: With time running short before drastic cuts to agencies have to occur. What are lawmakers considering?
Shawn Ashley: There are several pieces of legislation which the House has passed and sent over to the Senate. And this essentially would appropriate all of the available carry-over money, leaving no cash for the legislature to deal with the Department of Health situation that exists now, where they need upwards of $30 million perhaps by the end of the month just to make payroll.
Dick Pryor: That carry over money is one time money.
Shawn Ashley: That's one time money and the Senate has been very very explicit in saying that they did not want to use up all their cash reserves in dealing with the current situation.
Dick Pryor: Speaker Charles McCall seems resigned to a cash-and-cuts approach with onetime money. While, the Senate has been more interested in raising revenue for a longer term solution. Are the two houses even working together?
Shawn Ashley: I'm not sure that they are. Since the beginning, the Senate has been clinging to this idea of recurring revenue and finding a way to address the problem going forward. That is something that fits right into the approach that Senator Shulz announced when the legislative session began back in February, that they were looking toward the future not just tomorrow. In the case of the House and House Speaker McCall, cuts always seemed to have been a portion of their plan along with using any available cash reserves that they could get their hands on.
Dick Pryor: Governor Fallin has implored legislators not to use one-time money to fill the hole and not to cut agencies even more. And after the House failed to pass the bill called the A-plus plan she expressed her frustration.
Governor Mary Fallin (Tape): There are those in the Capitol that will never feel like we audited enough, that we have cut enough. I mean there's no way to make them happy. But what I know is that we have to solve our problem and our brand and our image of a state is suffering. It's embarrassing.
Dick Pryor: The governor added that this is not a joke and there is not a bunch of money sitting around. And ominously she reminded that there is likely to be a $600 million budget hole next session.
Shawn Ashley: That's why the Senate has been so committed to the idea of recurring revenue. You need additional money coming into the state in order to offset the $600 million of one time money which you use to balance the current fiscal year's budget. We also heard this from some members of the house it is worth noting. Former House Appropriations and Budget Chair Leslie Osborn in debating for the A plus plan, pointed to the need for recurring revenue which that bill would have generated.
Dick Pryor: Raising taxes will be especially problematic next year in 2018 because it's an election year.
Shawn Ashley: I don't think it will be problematic. I think it will be impossible because it's an election year. Nobody wants to cast a vote for a tax increase in an election year, even if it means preventing state services from being cut.
Dick Pryor: Without a budget fix what happens on or about December first?
Shawn Ashley: We begin to see state services cut curtailed in and eliminated and we're already beginning to see the effects of some of that with these new cuts forthcoming. We'll see additional private providers cut their services and we'll see additional state provided services at least be suspended or go by the wayside.
Dick Pryor: Shawn, what is on the agenda for the week ahead?
Shawn Ashley: That's a good question. Lawmakers hopefully will talk and come up with a new plan a new approach that could be put on the floor and passed to address these situations.
Dick Pryor: That's Capital Insider. If you have questions e-mail us at firstname.lastname@example.org or contact us on Twitter @KGOUnews. Until next time, with Shawn Ashley, I'm Dick Pryor.