OKPOLICY.ORG
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.
The work of the standing committees is finished for this session. Bills now have one week to pass the floor of the opposite chamber to remain alive. At the same time, the appropriations and budget process is in full swing from now to the end of session. It’s complicated this year — as it has been for the past several years — because the budget cannot be balanced without revenue increases or unacceptable budget cuts. So, at this point, having taken no action on either, legislators have no idea how much money they are working with. How much revenue can be generated must be settled first before the budget picture can become clear.
An example in just one state agency of the devastating consequences of relying solely on cuts is the Oklahoma Health Care Authority. OHCA is considering provider cuts to rates for health care providers of up to 25 percent. According to reports in eCapitol, benefits for Medicaid recipients “being considered for elimination or reductions include pharmacy, behavioral health and durable medical equipment, private duty nursing services, adult organ transplants, dialysis, hospice services, physical and occupational therapy, and speech, hearing and language disorder services. Evaluated programs include the breast and cervical cancer treatment program and the waiver-funded Medically Fragile program and Program of All-inclusive Care for the Elderly (PACE).”
Cuts of this magnitude would essentially destroy the health care infrastructure. There are similar consequences in many other agencies, including education. Appropriations and other leaders in the House and Senate keep saying cuts of this magnitude won’t happen, but at the same time they have not announced a revenue proposal that would close all or part of that gap. I think there will be some revenue bills passed, but the question is how much?
This reminds me of the 1985 session when I served as House Appropriations Chair. We published two budgets so everyone could see the difference: One with cuts only and no revenue and one with $231.9M in increased revenue (1985 dollars). The revenue was a little from a lot of places: Mixed drink gross receipts tax ($21.9M), Insurance premium tax to domestic companies ($22M), Smokeless tobacco and snuff tobacco products tax ($0.9M), .25% sales tax ($51.5M, bringing the sales tax to 3.25 cents at that time), corporate income tax from 4% to 5% ($23.2M), motor fuel tax from 9 cents to 10 cents per gallon ($23.2M), Motor vehicle license and registration fees ($101.6M), change pari-mutuel split to reduce state’s share (-$1.4M), Income tax credit for new jobs (-0.8M), Ad valorem tax exemption for new industry (-$9M). The revenue measures passed. Memory fades, but I think there is as much as or more demand now to “fix it” than there was then.
