KGOU

Capitol Insider: Pressure Builds At Capitol As Legislative Session Nears End

May 5, 2017

Tensions are rising at the Oklahoma capitol as the legislative session comes to an end, with the state facing a $878 million budget deficit, and no revenue raising measures in sight.

What happened this week

Gov. Mary Fallin held a press conference on Wednesday, urging legislators to pass revenue-raising measures before the end of the legislative session on May 26.

“Lawmakers are prohibited by the state Constitution from considering revenue raising measures during the final five days of the legislative session - essentially, the last week of this month. That means, beginning Monday, they have about ten legislative days if they’re going to increase any revenue,” eCapitol news director Shawn Ashley said in his weekly interview with KGOU.

Gov. Fallin has been asking lawmakers to increase revenue throughout the entire session. She addressed it first in her State of the State speech in January and again in April.

“At one point, she held up a poster showing the $878 million deficit that they face for the upcoming fiscal year, and then wrote down how much additional revenue they had proposed raising in various pieces of legislation, and that number was zero,” Ashley said.

House Democrats have also called on Republicans to raise the gross production tax on oil and gas. In 2014, legislators lowered the gross production tax from 7 percent to 2 percent for oil production that occurs during the first 36 months of a new well’s life.

“That’s a significant reduction in that rate and, as a result, revenue from that tax has declined over time and continues to decline,” Ashley explained.

Capitol Insider talked with state superintendent of schools Joy Hofmeister. Check out the podcast here.

Throwing shade

Things even became tense on Twitter on Thursday when Gov. Fallin tweeted, “The House just adjourned at 10:55am for the weekend. We have left 11 days to fix the budget.”

Republican representatives responded from their Twitter account (@GOPHouseOK) with,  “The Speaker didn’t see your car in the parking lot when he left at midnight last night.”

Interview highlights

On where budget talks stand

Well, that’s an interesting question because, really, we have to keep in mind there are two sides to those talks. One is revenue raising and, as the governor has pointed out, we haven’t seen any significant revenue raising measures being considered, even put up for a vote. The other side of that is spending, and we’re not hearing them talk about spending at all. We’ve heard some talk about a teacher pay raise, but the only piece of legislation that would provide that dropped at the last deadline, so there is a lot of talking left to do between all sides to come to some sort of budget agreement.

On why Democrat votes matter

In order to increase any tax, you’re going to need 3/4 of the House of Representatives first to vote for it, or 76 votes. And then 3/4 in the Senate. There are only 72 Republicans in the House of Representatives, but not all Republicans are on board on increasing taxes. In fact, on Thursday, a new caucus formed, a House Republican platform caucus, which plans to stick to the tenets of the Oklahoma Republican party’s platform and one of those elements is to oppose tax increases in the final three weeks of the legislative session.

FULL TRANSCRIPT

Dick Pryor: This is Capitol Insider, an insider’s guide to Oklahoma politics, policy and people. I’m Dick Pryor, with eCapitol news director Shawn Ashley.

Shawn Ashley: How are you today, Dick?

Pryor: Great, Shawn. Time is running short to fix the state’s budget mess. Gov. Fallin has gone public with appeals to legislators to put politics aside and pass revenue raising measures to fill the state budget hole. She was more strident than usual. Why so? And why now?

Ashley: Well, the legislative session is nearing an end and lawmakers are prohibited by the state Constitution from considering revenue raising measures during the final five days of the legislative session - essentially, the last week of this month. That means, beginning Monday, they have about ten legislative days if they’re going to increase any revenue. Now keep in mind, she called on them early in the session, at the start of the legislative session, to look for ways to increase revenue and nothing much happened. We came on down to sometime in April and she appealed to the press and said, hey look, these guys are not considering revenue raising measures and they need to get moving. They need to do something. And here we are a month later and really nothing’s been done. At one point, she held up a poster showing the $878 million deficit that they face for the upcoming fiscal year, and then wrote down how much additional revenue they had proposed raising in various pieces of legislation, and that number was zero.

Pryor: House Democratic leader Scott Inman also had a press conference and offered a proposal. He stayed firm with a solution that he had offered at the beginning of the session.

Ashley: Yes. Like Gov. Mary Fallin, House minority leader Scott Inman has pretty much been telling the same story all legislative session. Back in January, before the session started, he indicated that Democrats would look at certain revenue raising measures if lawmakers would consider an increase in the gross production tax. A couple of years ago, the gross production tax was lowered from 7 percent to 3 percent on oil and gas, from 7 percent to 2 percent, excuse me, for oil and gas production that takes place during the first 36 months of a well’s life. That’s a significant reduction in that rate and, as a result, revenue from that tax has declined over time and continues to decline, according to Rep. Inman. He said if a change was considered, an increase in that rate was considered, Democrats would be on board looking at things like the cigarette tax and the motor fuel tax.

Pryor: With small numbers of members in both the House and the Senate, why do Democrats matter?

Ashley: Their votes matter. In order to increase any tax, you’re going to need 3/4 of the House of Representatives first to vote for it, or 76 votes. And then 3/4 in the Senate. There are only 72 Republicans in the House of Representatives, but not all Republicans are on board on increasing taxes. In fact, on Thursday, a new caucus formed, a House Republican platform caucus, which plans to stick to the tenets of the Oklahoma Republican party’s platform and one of those elements is to oppose tax increases in the final three weeks of the legislative session.

Pryor: So with less than three weeks to go before the session ends, where do the budget talks stand?

Ashley: Well, that’s an interesting question because, really, we have to keep in mind there are two sides to those talks. One is revenue raising and, as the governor has pointed out, we haven’t seen any significant revenue raising measures being considered, even put up for a vote. The other side of that is spending, and we’re not hearing them talk about spending at all. We’ve heard some talk about a teacher pay raise, but the only piece of legislation that would provide that dropped at the last deadline, so there is a lot of talking left to do between all sides to come to some sort of budget agreement.

Pryor: What is the level of tension right now at the capitol?

Ashley: I would say it’s pretty high. We’ve seen it on both the floor of the House and the Senate, to a certain extent. And we’ve seen it on Twitter. As recently as Thursday, Gov. Fallin made a comment regarding the House of Representatives finishing up before noon with their legislative day and the House speaker’s office retorted, we did not see the governor’s car here on Wednesday night at midnight when we were still working. Tensions are rising.

Pryor: Thanks, Shawn. That’s Capitol Insider. Catch us on kgou.org and on iTunes, where we’ll have an extended interview with state Superintendent Joy Hofmeister about education in Oklahoma. Until next time, I’m Dick Pryor.

Capitol Insider is a collaborative news project between KGOU and eCapitol. Music provided by Astral PlanesAs a community-supported news organization, KGOU relies on contributions from readers and listeners to fulfill its mission of public service to Oklahoma and beyond. Donate online, or by contacting our Membership department. eCapitol is legislative news and bill tracking service. Online content is available via subscription.