TRANSCRIPT
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Dick Pryor: This is Capitol Insider - taking you inside politics, policy, and government in Oklahoma. I'm Dick Pryor with Quorum Call publisher Shawn Ashley. Shawn, House and Senate negotiators and the governor finally reached an agreement on a budget for Fiscal Year 2026, which begins July 1st. What did it take to get the deal done?
Shawn Ashley: Well, we didn't know it at the time, but House Chaplain Ronnie Wilson effectively told us something was up on May 8th. Which was the deadline for bills to be heard in the opposite chamber. As he began his end of the week inspirational message, he joked he had been encouraged to take his time and talk as long as needed. Now that day, Senate President Pro Tem Lonnie Paxton and House Speaker Kyle Hilbert had been in talks with Governor Kevin Stitt, as they revealed later in the day. And Hilbert estimated they had spent three hours negotiating policy issues. That led to further discussions this past week and a lengthy meeting on Tuesday that included Long John Silver's takeout at some point. Where the deal was finalized.
Dick Pryor: Alright. What are the highlights of the deal?
Shawn Ashley: The proposed budget totals $12.5 billion. Most agency’s operational budgets were held flat but millions of dollars appropriated for one-time things like capital projects in the current fiscal year are redirected in the next budget year to other uses. The budget includes a tax cut. One quarter of one percentage point. And it eliminates the bottom three tax brackets. It also includes a path to zero - the income tax’s eventual elimination. As of this past Wednesday, negotiators had not agreed to the formula for the trigger that will reduce the individual income tax rate to zero over time. And Stitt and legislative leaders said they also had reached agreements on certain policy issues. Which is where the discussions began on May 8th.
Dick Pryor: The Oklahoma Department of Mental Health and Substance Abuse Services needs at least $27 million in a supplemental appropriation just to make it through this fiscal year. So how does the proposed budget handle that agency's shortfall?
Shawn Ashley: The budget includes that supplemental appropriation to the department for the current fiscal year. It also carries that amount into the next fiscal year and its FY 2026 appropriation includes two line-item increases: additional funding to cover costs associated with the consent decree for the lawsuit regarding competency restoration and an increased maintenance of effort funding for mental health services. House Appropriations and Budget Chair Trey Caldwell said the legislature will work through the interim to root out the agency's financial problems and address them in February when it reconvenes. Perhaps providing an additional supplemental if necessary.
Dick Pryor: The days are running short to complete the budget approval process and handle the other end-of-session items. So how do lawmakers get their work done by the time they are required to adjourn at the end of the month?
Shawn Ashley: It's going to be tight. All the budget bills have to be approved by the Joint Committee on Appropriations and Budget, J-CAB, before they go to the House and Senate floor. And they have to pass both chambers before they go to Governor Stitt. Those various policy bills are at various stages in their final steps of consideration. Some need to be heard in only one chamber. Others are in conference committee where their final language will be written. And then they too have to pass and move on to the governor. And some of them actually have already been signed.
Dick Pryor: On Thursday the governor announced a major business deal to bring an aluminum production plant to Oklahoma near the Tulsa Port of Inola. According to a press release, this will be the first new primary aluminum production plant built in the U.S. in 45 years. What's involved in this agreement and what does it require the legislature to do in the waning days of this session?
Shawn Ashley: There are hundreds of millions of dollars of existing incentives involved in this deal. Plus, according to a memorandum of understanding between the state and the company, the deal is contingent on legislative approval of an incentive package totaling $255 million as well as $20 million from the governor's Quick Action Closing Fund.
Dick Pryor: Other than the budget, what are you going to be watching in the week ahead?
Shawn Ashley: Whether the legislature tries to complete all of its work by Friday, May 23rd and whether Governor Stitt allows more bills to become law absent his signature.
Dick Pryor: Thank you, Shawn.
Shawn Ashley: You're very welcome.
Dick Pryor: For more information, go to quorumcall.online. You can find audio and transcripts at KGOU.org and look for Capitol Insider where you get podcasts. Until next time, with Shawn Ashley, I'm Dick Pryor.
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