Carryover funds likely to be used for budget holes

Lawmakers are expected to return to the Capitol next week to tap carryover money and revolving funds to balance the current state budget.

House Majority Floor Leader Jon Echols said there is a tentative agreement to plug the budget hole using some of the $83 million in carryover from fiscal year 2017 and some money from the millions in agency revolving funds.

Senate Appropriations Chairwoman Kim David, R-Porter, said agencies will see about $60 million in cuts. Most will see about 2.25 percent reductions, David said, but major agencies will see lesser cuts.

The agreement also includes a $30 million supplemental appropriation to the Oklahoma Health Department to make its payroll after financial mismanagement at the agency was detected, David said.

Gov. Mary Fallin said it was her preference that the House vote again on House Bill 1054, which was held on a motion to reconsider the vote by which it failed. Her second preference was a vote on a stand-alone $1.50-per-pack tax on cigarettes, she said.

Earlier this week, HB 1054 failed to secure a needed supermajority of votes in the Oklahoma House. It included a $1.50 tax on cigarettes, a fuel tax hike, an increase in the gross production tax and a tax on lowalcohol beer.

Fallin said she will not sign a bill that spends all of the $83 million in carryover, cuts $90 million to agencies or makes cuts to critical state services, such as the Advantage Waiver program, which helps people stay in home instead of going to a nursing home.

Echols, R-Oklahoma City, said he expected little to no program cuts to the Department of Human Services, Department of Mental Health and Substance Abuse Services and the Oklahoma Health Care Authority.

The agencies have been in the process of notifying clients that programs will be cut or eliminated unless the budget outlook improved.

The Health Care Authority, the state’s Medicaid agency, on Thursday voted for a 4 percent reduction effective Dec. 1 for longterm-care facilities and 9 percent for most other providers in light of the budget situation. Echols decried the move, saying he was extremely disappointed and adding that it showed a lack of communication with lawmakers.

The Wynnewood Care Center closed as a result of reductions, sending 25 clients to other facilities.

“We don’t have steady funding sources in Oklahoma so it didn’t make sense to keep it open,” said Bart Reed, CEO. He has seven other nursing homes.

Brett Coble, president of the board for the Oklahoma Association of Health Care Providers, expressed skepticism that an agreement to prevent cuts had been reached.

“My response is until they have, they have not,” he said. “Until there is a solution that has been voted on, agreed on, and voted on and communicated to the agency, they have not come up with a solution.”

He said agency chiefs are carrying out their obligation to notify different beneficiaries and providers, which is required by law.

Echols said he wished the decision to use cash to plug the budget hole had been made during the first week of the special session, which began Sept. 25, but that the Senate and Fallin’s office wanted a vote on revenue-raising measures.

Echols said it is now clear the House doesn’t have the required votes to raise taxes.

The House on Thursday passed House Bill 1058 directing the Department of Human Services to maintain services in certain programs, including the Advantage Waiver and In-home Supports waiver.

“They have to have the money,” Echols said.

Fallin called lawmakers into special session after the Oklahoma Supreme Court ruled that they illegally passed a $1.50 cigarette tax as a fee.

The action blew a $215 million hole in the fiscal year 2018 budget, but coupled with a loss of federal matching dollars, the figure is closer to $500 million.

The bulk of the dollars went to the Department of Human Services, Department of Mental Health and Substance Abuse Services and the Oklahoma Health Care Authority.

Recipients of services provided through the three agencies, such as those to the elderly and disabled, are extremely concerned about the potential of the cuts.

Echols said it is “unconscionable to use people as pawns in a political game.”

Fallin has been highly critical of the use of onetime funds to plug budget holes and making additional cuts to state agencies which have already reduced spending.

“If the Senate and House can pass a bill within the criteria I have laid out, I will look at it then and make a decision,” Fallin said. “So far, no budget bill has made it through both bodies other than the measure that appropriates $23.3 million from the Rainy Day fund to the Department of Mental Health and Substance Abuse Services, which I signed Monday.”