Budget cuts advance at Capitol

House Democrats announce support for alternative proposal

State agencies would be required to trim their budgets by 0.66 percent for the current fiscal year under a measure approved Thursday by the House and Senate Joint Committees on Appropriations and Budget.

In reality, agencies would have to cut their budgets by 1.98 percent for the remainder of the fiscal year, since there are only four months remaining and the cuts would have to be condensed to fit in that time frame.

Meanwhile, Gary Jones, Oklahoma's Republican state auditor, proposed a new revenue plan and House Democrats

announced they would all support it.

Consideration of cuts and/or new revenue measures became necessary after House members voted Monday to reject a $581 million tax hike package backed by Step Up Oklahoma, a coalition of Oklahoma business and civic leaders.

Gov. Mary Fallin amended her call for the ongoing second special session of the Legislature on Thursday so that lawmakers could consider the budget cuts along with supplemental funding for graduate medical education.

Auditor Jones called a news conference Thursday afternoon to propose what he described as a compromise revenueraising measure to fund

teacher and state employee pay raises.

Jones, who is running for governor, proposed increasing the initial gross production tax on oil and natural gas to 5 percent, raising the tax on cigarettes by 75 cents a pack, taxing little cigars like cigarettes, increasing the gasoline tax by 3 cents a gallon and hiking the tax on diesel fuel by 6 cents a gallon.

House Democratic leaders said all 28 House Democrats would be willing to support that plan, which would raise $448 million that could be used to fund teacher and state employee pay raises.

Republican House Floor Leader Jon Echols said he was “excited” to hear the auditor’s proposal and promised it would be fully considered. However, he said budget cuts will be necessary even if the new plan is adopted.

Unlike the Step Up

Oklahoma plan that lawmakers rejected Monday, the auditor’s plan did not include reform measures, although Jones said he supported many of the reforms that the coalition suggested.

The auditor’s plan also does not include money for core services during the current fiscal year, said Echols, R-Oklahoma City.

Echols said the plan doesn’t appear to generate enough revenue to fully fund a $5,000 teacher pay raise, but quickly added, “there is something there and it needs to be analyzed.”

Meanwhile, House members continued to move forward with proposed state agency budget cuts, passing them in a House committee after Jones held his news conference.

The full House and Senate and the governor would have to sign off on the proposed cuts before

they could become law.

Thursday morning, Senate Committee Chair Kim David, R-Porter, said the cuts are expected to save about $44 million, which would be used to fill holes in the budgets of the Oklahoma Department of Human Services, Oklahoma Health Care Authority and Oklahoma Department of Mental Health and Substance Abuse Services.

Those budget holes were created when the Oklahoma Supreme Court declared a proposed cigarette fee unconstitutional, cutting off a new source of funding that had been designated to go to those agencies.

Without additional funding from the Legislature, those agencies would run out of money before July 1.

House and Senate budget panels approved two other measures Thursday.

One would appropriate an extra $31.7 million to the Oklahoma Health Care Authority this fiscal year and $110 million next fiscal year to save Oklahoma State University and University of Oklahoma graduate medical school programs which are in jeopardy because of a funding dispute with the federal government. That dispute has resulted in federal funds being withheld.

The other bill informs the Department of Human Services that the Legislature expects the agency to use restored funds to keep from making any cuts in its programs that benefit the elderly and individuals with developmental disabilities. The measure specifies a long list of programs that lawmakers do not want to see trimmed.

DHS Director Ed Lake said the new appropriations bill would result

in his agency having to absorb a $4.6 million budget cut, rather than a steeper cut that would be necessary without it.

“The department believes it can achieve this reduction by continuing to hold numerous positions vacant across the agency — except for front-line child welfare positions — a process that has been ongoing since the beginning of the fiscal year,” Lake said. “DHS has already made almost $25 million in cuts this year to balance its budget.”

Lake said he appreciated legislative efforts to cushion his agency from some of the cuts triggered by the state Supreme Court’s rejection of a new law that sought to impose a cigarette fee. The court ruled the fee was really a tax and lacked the threefourths majority vote needed to approve tax measures in Oklahoma.