Oklahoma lawmakers will face at least a $900 million budget shortfall, spending cuts, and a teacher shortage when it convenes Monday.
State Sen. David Holt, R-Oklahoma City, state Rep. Emily Virgin, D-Norman, and University of Oklahoma political scientist Keith Gaddie joined KGOU’s Jacob McCleland to talk about issues the legislature will address in its 2016 session.
Budget, Front And Center
Holt doesn’t expect tax increases to be a serious consideration to address the budget shortfall, but the legislature will examine tax code reform and off-the-top spending that doesn’t go through the appropriations process. Major cuts to spending will also be a major component, Holt said.
Education accounts for over 50 percent of state-appropriated funding, according to the Associated Press. Holt said there is little appetite for more education cuts, but other agencies and programs will feel the squeeze if education funding is held flat.
“You put a pretty big burden on everything else and, as it turns out, people like some of that other stuff too,” Holt said. “That's a two step process towards cutting because you've got to first bring it back into the appropriations process and then obviously you have to cut it,” Holt said.
Holt estimates there are about $2 billion in tax credits, rebates and deductions and he hopes the legislature can find money from that pot through tax reform.
“Every year that I've been there we've talked about tax credits and which ones that we can get rid of and which ones we can put a cap on, things like that,” Virgin said. “But every year, as Sen. Holt knows, the constituency of that tax credit comes to the capital and says, 'We can't live without that tax credit' and then it becomes really tough to get rid of that tax credit.”
Holt said the budget crisis is an opportunity for Oklahoma to become more efficient. Oklahoma, he said, is both low-tax and highly inefficient.
Mental Health, Criminal Justice Reform
Fallin says she wants to see more funding go toward infrastructure, healthcare, and corrections. Virgin thinks the current funding environment will open up the opportunity to address criminal justice reform.
“You've got the ACLU and you've got the Right on Crime organization coming together and so it is finally to the point where we are seeing that is a huge pot of money that we don't have to be spending, that we can make some changes there and save money not just this year, but in the long term,” Virgin said.
Gaddie points to Georgia’s criminal justice reform that included alternative treatment for non-violent drug offenders as an example of a conservative state that addressed how it handles incarceration.
“We have the highest incarceration rate in the country, in a country that has the highest incarceration rate in the civilized world,” Gaddie said. “This is our big growth industry right now, is throwing people in prison and we got to talk about that too.”
Virgin also says criminal justice reform and overhauling the state’s mental health system go hand-in-hand.
“If you can invest in mental health, then you can spend less in corrections,” Virgin said. “I think that people are ready to invest in that for the long-term."
State Rep. Lee Denney, who's a Republican from Cushing and the speaker Pro Tem of the House, toldOklahoma Watchshe wants to see more of a focus on mental health.
"You know, this year we've had two very public incidents that show that we need to really put some money where mental health is concerned,” Denney said. “And that's with the Mark Costello murder, and then of course the OSU tragedy."
Labor Commissioner Mark Costello was stabbed to death in northwest Oklahoma City in August. His son Christian Costello, who has a long history of mental health issues, is awaiting trial. Adacia Chambers, the woman charged with four counts of second-degree murder for driving a car into Oklahoma State University’s homecoming parade.
Late Night Fodder Still There
With the budget’s importance top-of-mind this year, Virgin hoped legislators would file fewer social issues bill. But she said that isn’t the case.
“We got bills dealing with who gets to go into which public restroom and that just doesn't seem like a good use of our time when we've got a billion dollar shortfall,” Virgin said.
Holt said this type of legislation, which doesn’t seem focused on relevant issues to most Oklahomans, always takes the forefront in the first month after bill filing.
“They won't get heard in committee, they will, however, be heard on The Daily Show and on Saturday Night Live. This has become an annual tradition in the Oklahoma legislature,” Holt said. “In the coming weeks it is highly likely that everyone else will be spending their time talking about kind of silly issues before we get to the serious stuff before those bills die.”
Preparing For The Future
Gaddie doesn’t think the legislature has the will to learn a lesson from this latest dip in the energy sector’s boom and bust cycle, which has seen oil price plummet below $30 per barrel and state funds dwindle. After the last bust, the state’s savings account, or Rainy Day Fund was established, but lawmakers found loopholes to access that money.
“The first lesson is, when times are good, you load that thing up, you expand its capacity and you keep it up. So, after we get out of this cycle, we take a look and see, what do we need to do to further stabilize our revenue flows and the ability to hold reserves,” Gaddie said. “But I don't have a lot of faith that those lessons will be learned because during the last bust we had been cutting taxes going into that and then we got creamed and it took about three years to recover. And, here we are again, we did the same thing going in. Times were good, we are rolling in money, so we start cutting taxes, cutting taxes and we aren't saving and we get creamed again.”
Holt has proposed that 15 percent of the state’s total budget - around $24 billion - go into the rainy day fund.
“I think we need to have a more robust savings account and I think the simplest and easiest way to do that is to simply measure it against the total state budget, which we now know to be $24 billion, not $7 billion,” Holt said.
Holt said saving 15 percent of the state’s appropriated funds, which is around $7 billion, is like a household that saves 15 percent of its cable bill.
Virgin wants to diversity the state economy to decrease reliance of the energy sector’s booms and busts.
“Nobody really likes that we have a boom and bust cycle economy in Oklahoma. So, let's do something about it,” Virgin said. “Let's diversify our economy and so when energy prices dip like this we aren't so in a dire situation.”
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