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New budget is a squandered opportunity of massive proportions

by | November 13th, 2017 | Posted in Blog, Budget, Media, Press Releases & Statements | Comments (9)

Here is our assessment of the budget unveiled on Nov. 13th by House and Senate leaders. UPDATE: The new General Appropriations bill, HB 1019X, has now passed the House and Senate and awaits action by the Governor.

Lawmakers had plenty of sensible options for recurring revenues that could have balanced the budget responsibly. Instead, they are doubling down on one-time money and cuts. This is the inevitable but unfortunate consequence of last week’s failed vote in the House of Representatives on HB 1054.

For those fearing the worst cuts, the new budget represents a partial reprieve. Overall funding is just $30 million, or 0.4 percent, less than the budget passed in May, according to our preliminary analysis. It avoids further cuts to Common Educations, Corrections, and several other critical agencies. In addition, it mostly fills the massive shortfalls that were facing the Medicaid agency, DHS and Department of Mental Health and Substance Abuse Services. This will hopefully allow these agencies to rescind the devastating cuts they would otherwise be forced to make starting December 1st.

But the costs of this new budget will be substantial. A majority of agencies, many of which have seen their funding slashed by 20- 40 percent over the past decade, are hit with a further 2.4 percent cut. The list includes Higher Education, the Arts Council, the Department of Public Safety, and agencies responsible for protecting the environment, providing care to veterans, and ensuring labor standards.

Rather than beginning to climb out of a hole, lawmakers are digging themselves in deeper. The new budget relies on an additional $138 million in one-time dollars from the Rainy Day Fund and multiple agency revolving funds, while using up almost two-thirds of last year’s cash surplus. Along with one-time money appropriated in May, the new budget includes over $480 million in cash. When known obligations are considered, the state is staring at another budget deficit for FY 2019 of some $650 million.

This new budget is another instance of a failed approach that has left Oklahoma stuck in a permanent budget crisis and has led to a steady and continual erosion of the public services Oklahomans expect and deserve. Oklahomans will have to express their dissatisfaction and intensify the pressure to ensure that next session finally brings a different and better approach.

What now?

by | November 10th, 2017 | Posted in Budget | Comments (0)

A week ago we wrote: “At this point (barring further surprises), special session is likely to conclude with a new budget that averts the doomsday scenario facing the three health and social services agencies but does not address Oklahoma’s chronic budget problems.”

Since then, there have been several surprises, moments of new hope and great disappointment — but the prognosis remain about the same. This post is intended to get readers caught up on where we are and where things may be headed. For a full overview, see our regularly updated frequently asked questions about special session.

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This is Oklahoma’s last chance

by | November 7th, 2017 | Posted in Budget, Taxes | Comments (1)

Note: This post has been updated to reflect the most recent information (11/7/17: 9:00 pm)

You are needed right now to contact your Representative and urge him or her to support the comprehensive budget plan contained in HB 1054.

Monday, the State Senate passed with a bipartisan vote of 37-5 a revised version of HB 1035 which includes a $1.50 cigarette tax increase, a 6 cent fuel tax increase, and a 4 percent gross production tax on new wells. This comprehensive revenue plan, also dubbed Plan A+ or the “Grand Bargain”, must pass with a three-quarters majority to take effect in time to save lives threatened by the state’s budget emergency.

Tuesday, a new version of the comprehensive plan containing identical language to HB 1035 was introduced as HB 1054 and passed out of the House JCAB committee on a 19-6 vote. The bill number has changed but the plan is the same.

HB 1054 is expected to be heard by the full House today (Wednesday).

The deal contained in HB 1035/HB 1054 is the only solution left to avert devastating budget cuts, provide desperately needed raises for teachers and state employees, and restore the Earned Income Tax Credit for low-income workers. House members from both parties must support HB 1035/HB 1054so that it reaches the supermajority needed to pass a revenue bill.

This is it. This is the last chance for a comprehensive, fair, and long-term solution to the budget crisis. The hard reality is that there is no choice between HB 1054 and some better deal. The only choice is between HB 1054 and a far worse deal or no deal at all. The far worse deal, which has been promoted by House Republican leadership in recent days, involves a combination of one-time cash and cuts that would deepen next year’s budget hole, put our credit rating at risk, and do more damage to important state services needed by Oklahoman families. If there’s no deal at all by December 1st, Oklahomans’ health care and social services will be devastated.

The Senate vote means that there is now a realistic path to a good outcome — but it will take House members knowing that they have their constituents’ support for a tough vote. Please contact your House member today in support of HB 1054. Be sure to share how the failure to resolve the budget crisis will affect your family, your business, or your community. See our Advocacy Alert for talking points and additional resources and our Special Session Frequently Asked Questions for more information.

Here is our full statement on why OK Policy supports the comprehensive budget plan that is on the table and that requires passage of HB 1035/HB 1054:

The comprehensive budget plan based on HB 1054 is the best possible outcome and the only good outcome under our current  circumstances. It recognizes that the state budget can only begin to be fixed with new recurring revenues and provides an important measure of fairness by curbing the tax break for oil and gas companies and restoring the earned income tax credit.  Most urgently, it averts catastrophic cuts to our health care system and social safety net while providing crucial pay raises for teachers and state employees. There is still much more work to do in the next regular session to ensure a fairer tax system and a budget that meets the needs of Oklahomans, but now is the time to approve this compromise and bring the budget emergency to an end. We  urge all House members to support HB 1054.

Oklahomans left guessing by actions in special session (Capitol Update)

by | November 3rd, 2017 | Posted in Budget, Capitol Updates | Comments (3)

Steve Lewis served as Speaker of the Oklahoma House of Representatives from 1989-1991. He currently practices law in Tulsa and represents clients at the Capitol.

I can’t imagine that any Oklahoma citizen not participating in or observing full time the actions in the special session has any real idea of what is going on or why. Even for those who did observe or participate in the proceedings, it’s a guessing game.

For background, the governor issued a special-session call that, if passed, would create a vision of Nirvana in which: 1. the short-term revenue failure for this fiscal year; 2. the long-term structural budget deficit; 3. additional funding for a teacher pay raise; 4. additional funding for a state employee pay raise; and 5. a tax break for the trucking industry would all get done in a brief special session. Unrealistic? Ya think?

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​I’m an adoptive parent. S​tate budget cuts put my family at risk.

by | November 2nd, 2017 | Posted in Budget | Comments (5)

Shelley Cadamy

Shelley Cadamy is a native Oklahoman. She has worked in economic development in Oklahoma since 1994 and is a foster/adoptive parent.

Nine years ago, I fostered and then then adopted my three kids. They’re biological siblings, now 12, 15, and 18 years old, and they’re fabulous. I can’t imagine my life without them. However, like most kids in the foster care system, my kids have significant mental health needs due to neglect, trauma and abuse. When I adopted them, the State of Oklahoma offered limited resources to help support my kids, including a monthly subsidy and SoonerCare coverage until adulthood. Even with my income, which is above average, that support was what made adopting them possible for me. However, due to years of budget cuts, that support is at risk.

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What now? With clock ticking, Legislature weighs options to avert Doomsday

by | November 1st, 2017 | Posted in Budget | Comments (11)

Last week, lawmakers’ attempt to address the state budget crisis in special session collapsed. They rejected proposals that would have filled the entire budget hole and averted imminent and catastrophic cuts to the three health care and social service agencies — the Department of Mental Health and Substance Abuse Services , Oklahoma Health Care Authority, and Department of Human Services — that lost $214 million in funding when the State Supreme Court found a cigarette fee passed earlier this year unconstitutional.

At this point (barring further surprises), special session is likely to conclude with a new budget that averts the doomsday scenario facing the three health and social services agencies but does not address Oklahoma’s chronic budget problems. It would also impose a new round of cuts on most or all state agencies. In the meantime, with each new day that passes without an agreement, the hundreds of thousands of Oklahomans served by the three agencies must grapple with rising anxieties that the crisis won’t be resolved and that they will lose the services that their health, and even their lives, depend on. 

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Turnover of state workers climbing as their salaries fall further behind

by | October 31st, 2017 | Posted in Budget | Comments (1)

We expect a lot from the Oklahomans who work for state government. These are the men and women we entrust to care for victims of abuse and neglect, supervise the most dangerous criminal offenders, stop the spread of infectious diseases, and ensure that our laws are applied fairly.  We expect them to be well-trained, to work hard, and to maintain the highest ethical standards. Unfortunately, a decade of budget shortfalls have made it increasingly difficult to pay state workers competitive wages. The result is that state compensation is lagging further behind the private sector, leading to increasingly expensive employee turnover.

A newly-released study  finds that average salaries for state employees fell to 24 percent below the competitive labor market in 2016, “a continued deterioration of the state’s salary position to the market.” As compensation fell further behind, the state employee turnover rate rose to 20.5 percent in 2016, which is a nearly 40 percent increase from a decade earlier. Employee turnover cost the state over $135 million in 2016, the report found.

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Statement: Latest Republican budget plan ignores obvious solutions

by | October 23rd, 2017 | Posted in Budget, Press Releases & Statements | Comments (4)

Oklahoma Policy Institute issued the following statement on the new budget proposal announced by Governor Fallin and Republican legislative leaders:

Since the beginning of special session four weeks ago, the bipartisan framework needed to end our budget emergency has been clear. Lawmakers must pair a cigarette tax increase with restoring some income taxes on very high earners and ending some of Oklahoma’s extraordinarily generous tax breaks for big oil and gas. These are the revenue options most popular with Oklahoma voters and most likely to win the needed super-majority approval in the Legislature.

That Governor Fallin and Republican legislative leaders chose not to offer this obvious plan is extremely discouraging for the Oklahomans in severe danger due to lawmakers’ budget deadlock. Foster families, people with mental illness, people who depend on rural hospitals, vulnerable seniors and children, teachers and state employees, and all of us among their friends and families deserve better.

Oklahoma’s structural budget problems will not be solved while lawmakers insist on asking nothing from the wealthiest households and most profitable businesses in our state. This proposal simply continues the political grandstanding that has prevented the obvious, popular, and fair solution preferred by a large majority of Oklahomans.

We’re encouraging Oklahomans to continue contacting lawmakers and visiting the Capitol if you are able. Click here for more information and ways to take action.

Secret votes and unwillingness to lead are prolonging Oklahoma’s budget stalemate (Capitol Update)

by | October 20th, 2017 | Posted in Budget, Capitol Updates | Comments (1)

Steve Lewis served as Speaker of the Oklahoma House of Representatives from 1989-1991. He currently practices law in Tulsa and represents clients at the Capitol.

What’s going on with the special session?

I’m reliably informed that Republican House members, in their caucus meetings, have discussed and voted on 27 different budget scenarios. Of the 27 proposals, none have received more than 39 votes, and some received as low as 8 votes. What are these 27 budget proposals? We don’t know because party caucus meetings are held behind closed doors. And it has become a tradition that caucus members are in violation of some sort of honor code it they reveal what’s said in caucus. This is to allow free and open discussion among party members, the theory being that legislators will be afraid to bring up controversial, possibly unpopular, ideas if anyone outside the room finds out they did so. This is not a particularly admirable quality of the legislative psyche, but it’s a nod to reality. The real problem, however, is the caucuses taking these votes which then are accepted as the policy of the state while constituents have no way of knowing how their representative voted.

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What happens ‘when push comes to shove’ on the budget (Capitol Update)

by | October 13th, 2017 | Posted in Budget, Capitol Updates | Comments (0)

Steve Lewis served as Speaker of the Oklahoma House of Representatives from 1989-1991. He currently practices law in Tulsa and represents clients at the Capitol.

There’s a phrase that most people have heard or used: “when push comes to shove.” Generally, this means there’s a standoff, and the question is, “what’s going to happen when push comes to shove?” Well, in the special session, push has come to shove. Both the Republican majority and the Democratic minority say they want to raise revenue for state operations — at least enough to avoid further budget cuts during the current fiscal year ending next June. But the time is quickly coming when the agencies most affected, the Department of Human Services, Oklahoma Healthcare Authority, and Department of Mental Health and Substance Abuse Services will be running out of money unless they make the cuts.

The argument is pretty much where it left off last May. Here’s the “push”: Republicans want an increase in the cigarette tax of $1.50 per pack and perhaps a gasoline tax increase as the bedrock of their revenue-raising plan. But even with a 2/3rd-plus margin in the House, they cannot pass these tax increases without Democratic votes. Too many Republican legislators will vote “no” on their own party’s position.

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