Today we’re at the State Capitol looking into the state budget deal announced yesterday. Here’s our initial statement on the budget, a list of the proposed appropriations, and a summary of the budget agreement.
See below for live updates as we uncover more about the budget and analyze what it means for Oklahomans.
Without any new money for common education, this budget would mean Superintendent Joy Hofmeister’s plan to increase teacher salaries and extend the school year won’t happen this year or next. Hofmeister commented on the budget, “It’s a severe disappointment that this agreement was unable to address a crippling teacher shortage that continues to negatively impact Oklahoma schoolchildren. The longer we fail to make our investment in common education a priority, the more likely it is we will pay economic and societal costs down the road. Our teachers deserve better than salaries that are among the lowest in the nation.”
The budget does try to minimize cuts to education and some other services, but only by using up hundreds of millions in one-time revenues. That’s brought criticism from at least one Republican legislator. Jason Murphy, R-Guthrie, commented, “The budget heavily depends on one-time revenues to fund ongoing expenses, and that certainly isn’t a sound budgeting technique. It’s not fiscally responsible.”
We’ve arrived at the Capitol! The budget bill (HB 2242) will be heard in the Joint Committee on Appropriations and Budget this afternoon at 2. Word is some legislators are pushing to get everything done by Saturday so they can go home a week early.
One piece of revenue in the budget the Oklahoma State Chamber is not happy about – cutting rebates to businesses for Workers Comp insurance. That’s worth about $24 million.
House is now debating the bill that redirects some “off the top” transfers from education and transportation to the general fund. (HB 2244)
To get to a $7.138 billion budget for FY 2016, the budget deal includes $590 million in additional revenue beyond the $6.6 billion that was certified in February. Of the $590 million, at most $62 million involves recurring revenue sources – largely proposed changes to apportionment that will redirect revenues from dedicated funds to the General Revenue Fund. This means that next year’s budget begins with a $530 million deficit from this use of one-time revenue, plus an additional $100 million hole from the full-year impact of the income tax cut due to take effect January 1st.
Heard on the House floor: “Did ODOT (OK Dept of Transportation) take a hickey on their 8 year plan?”
The budget deal delivers a $24.1 million, or 2.44 percent, cut to Higher Education. As we noted yesterday, the state regents said a 2.6 percent reduction would result in the elimination of more than 100 academic courses, 80 faculty positions and more than 55 staff employees.
The budget takes $72 million from the County Improvement for Roads and Bridges (CIRB) Fund: $50 million from this year’s apportionment of motor vehicle tax revenues and $22 million from capping the allocation to the Fund going forward.
House budget chair Rep. Earl Sears: “I had members wanting to take more out of higher education, take more out of common education.”
House Minority Leader Rep.Scott Inman: “101 of us believe education and transportation should be a top priority. We’re being asked by the ones in charge to divert money away from education and transportation.”
A motion to suspend the rules so the budget can be rushed through this week is a few votes short. The vote has been left open half an hour as they try to pressure members to switch their votes. 3 Republicans joining all Democrats as holdouts.
Enough Republicans switch votes to suspend the rules, which opens the path for the state budget to move through just 48 hours after anyone sees it.
Just confirmed that even with a $18 million appropriation increase, Oklahoma Health Care Authority will proceed with $110 million in cuts to provider rates and benefits mostly effective July 1st. Includes reducing payments to mid-level practitioners, eliminating adult dental services, adding prior authorization for spinal surgeries, adjusting payments for physicians and hospitals, other budget reductions.
Among the handful of agencies that will not receive any cut under the budget agreement are the House of Representatives, Senate and Legislative Services Bureau. Other agencies, including Arts Council, State Auditor and Inspector, Commission on Children and Youth, Fire Marshall, being cut 7.25 percent
The text of the general appropriations bill has just been posted: http://webserver1.lsb.state.ok.us/cf_pdf/2015-16%20COMMITTEE%20AMENDMENTS/House/HB2242%20FULLPCS1%20EARL%20SEARS-MT.PDF
The budget agreement taps the state’s Rainy Day Fund for $150 million. This comes from the portion of the RDF that may be appropriated with a simple legislative majority when next year’s General Revenue collections are forecast to be less than the current year’s collections. With a $535 million balance, up to $200 million could be appropriated to help cover next year’s shortfall. An additional $133 million is potentially available upon declaration of an emergency and a supermajority vote. If the budget is approved, $385 million will be left in the RDF.
Senate Joint Committee on Appropriations and Budget passes $7.2 billion budget bill without questions or debate. Ladies and gentlemen, your Oklahoma democracy.
Lots of agencies are hit hard by the budget, but the Tourism Department may be the biggest loser, taking a triple hit. Its appropriation is cut by 5 percent ($1 million); it has $7.5 million taken from its revolving funds, and its apportionment of sales and use tax revenues is reduced by $7.8 million. The agency’s total budget from all sources is about $94 million, so this is a major reduction.
Testifying before House committee, ODOT director says all road and bridge repair projects on the state’s 5 year and 8 year plans will be completed, just maybe not within 5 or 8 years.
DHS will receive additional $15.9 million for child welfare Pinnacle Plan, but then is cut $12 million for other operations. With loss of federal funds and increases in mandatory costs, DHS will need to implement over $40 million in budget cuts for FY 2016, some of which will likely be to rates for private providers
State Auditor and Inspector’s office, which has already been cut 30 percent in last 6 years, gets hit with another 7.25 percent appropriations cut this year and has $500,000 pulled from its revolving fund. With the agency already short several auditors, this could mean fewer trained staff to oversee the spending of taxpayer dollars
House Joint Committee on Appropriations and Budget passes the budget on a party line vote, 17-6.
And we’re out. The budget is rolling ahead with final votes tomorrow or Friday.