Capitol Insider: State Revenue Figures Certified
Lawmakers now know how much money they can appropriate in the 2021 Fiscal Year budget. KGOU's Dick Pryor and eCapitol's Shawn Ashley discuss that story and more in Capitol Insider.
Dick Pryor: This is Capitol Insider, your weekly look inside Oklahoma politics, policy and government. I'm Dick Pryor with eCapitol news director Shawn Ashley. Shawn, the state Board of Equalization, which is a group of elected officials, has approved the revenue amount that legislators will have available for appropriation this year. It's about $85 million less than last year. What does that mean for budget writers?
Shawn Ashley: Well, when you're talking about an $8.2 billion budget, $85 million is not that much of a revenue loss. It's only about one percent. But I think really the big discussion the other day focused on the fact that 310 million of that 8.2 billion is cash being carried over from fiscal year 2019. That's money that will not be available for re-appropriation in the following fiscal year.
So, Governor Stitt and even some legislative budget writers are encouraging caution. They don't want to see this money spent on recurring expenses where that money may not be there in future years. Each year, about 125 to $200 million or so is spent on one time expenditures. This may be improvements to a particular building, allowing an agency to buy new computers or something like that. So that is the direction the governor seems to want this money to be spent.
Dick Pryor: The revenue figures include money the state receives and exclusivity fees from tribal gaming. But those dollars are currently not going into the states account while the renewal of tribal gaming compacts is in dispute. So how do legislators draft the upcoming fiscal year budget not knowing when or if they will actually have those funds available?
Shawn Ashley: Well, that is an issue not just for gaming exclusivity fees, but it's an issue year to year related to revenue. As they look at the exclusivity fees, you are correct. We do not know if the federal court will have resolved the dispute between the governor, state and the tribes by the start of the new fiscal year on July 1st. And currently that money is being set aside and not distributed to education in the General Revenue Fund. Each year, though, lawmakers take the number that they are given in February by the Board of Equalization and they consider new tax credits, which will reduce that number. In previous years, we've seen them consider revenue enhancing measures which would increase that number. So it's all part of the budget process of working through exactly how much money they're going to have when they write that final budget. And they will string all those numbers together, the additional revenue they generate and the revenue they take away and come up with that final number. Oftentimes we forget the Board of Equalization meets again in June and it certifies a final number based on all the moves the legislature has made. And then it compares that to what is appropriated to make sure that they balance out.
Dick Pryor: The state has accepted the tribal gaming money. Where is it now?
Shawn Ashley: Well, right now, that money is not being distributed to common education, into the General Revenue Fund. It's essentially being set aside in an escrow account and held until the lawsuits are resolved. Barbara Hoberock with the Tulsa World reported on Friday that Senate Appropriations Chairman Roger Thompson has asked for an attorney general's opinion on that process because it raises an interesting issue: Can the governor and the Office of Management and Enterprise Services, which oversees the state finances, arbitrarily decide not to distribute money that is being paid to the state? That's exactly what they're doing here. The law says that money shall be distributed, but it's not being distributed.
Dick Pryor: Not yet.
Shawn Ashley: Not yet.
Dick Pryor: A Senate committee has approved a bill that prohibits local governments from regulating single family housing design elements. Sean, what is this bill about? And what are some cities attempting to do through these regulations?
Shawn Ashley: Well, a number of cities and towns in Oklahoma have implemented building codes that govern the exterior appearance of homes, how they should look. One of the most common that we've heard about is where they require brick rather than vinyl siding on the exterior of a building. What that does is increase the cost of the home. And Senate Majority Floor Leader Kim David pointed out that every $1000 increase in the cost of a starter home pushes 880 potential buyers of that home out of the market. So there is a concern about affordable housing here. Now, keep in mind, these are not health and safety codes. These are static codes that govern the appearance of the home.
Dick Pryor: What should we be watching for in the week ahead?
Shawn Ashley: In the week ahead there is a deadline for bills to be heard in committees of their chamber of origin, House bills and House committees, Senate bills and Senate committees. What this will mean is probably two things. One, a lot of activity in those last few days of committee meetings and some of that activity will involve bills that bounce around trying to find a committee that will hear them.
Dick Pryor: All right. Thanks, Shawn.
Shawn Ashley: You're very welcome.
Dick Pryor: That's Capitol Insider. If you have questions, email us at news@KGOU.ORG or contact us on Twitter @KGOUnews. You can also find us online at KGOU.ORG or ECAPITOL.NET. Until next time, with Shawn Ashley, I’m Dick Pryor.