State revenue outlook improved, officials say
TULSA — The state’s financial outlook is improving but challenges still lie ahead, Gov. Mary Fallin’s chief of staff and the Oklahoma Senate’s No. 2 Republican said Friday.
“I really think we’re on an upward trend,” Chris Benge, Fallin’s chief of staff and former speaker of the Oklahoma House of Representatives, said during a Tulsa Regional Chamber legislative briefing breakfast. “The economy is better. And, a (more) diversified economy I might add ... Probably have some growth revenue . ... I think the state’s net position will dramatically (improve).”
But Benge and Senate Majority Leader Greg Treat, R-Oklahoma City, said budgetary problems remain and could even intensify in the coming months.
In particular, they mentioned an effort to repeal through referendum petition the $400 million House Bill 1010xx signed into law three weeks ago, and the apparent loss of $110 million a year in federal Medicaid money that has been used to support physician training in the state.
“If the voters reject it through the ... petition, we’re back to Square One,” said Treat, who will lead the Senate as president pro tem next year. “And I would argue we would be Square negative-something.
“If it gets rejected,” Treat said, “trying to pass anything for education or any other area of state government for the remainder of my service will be near impossible.”
Later, Treat revealed the state has been notified the Trump administration will likely not allow Oklahoma to continue using Medicaid funds to pay for residencies for the state’s two medical schools. Oklahoma has done so for years under the impression it had a waiver to do so, but officials learned in recent years that the waiver expired and was never renewed. Federal officials have ruled such spending out in the future, Treat said, and may try to recover some of the money from previous years.
Treat, a Catoosa native, said his experience in the Legislature has led him to some difficult conclusions.
“When I first got into the Legislature and introduced a bill to reduce the income tax to zero, I really believed we could find it in waste, fraud and abuse,” Treat said. “But when I became the vice chair of appropriations a few years back, I realized if we really wanted to deliver on a teacher pay raise, if we really want the type of state I think our citizens deserve, we couldn’t do it on the existing revenue base.
“That was hard for me to come to that realization,” Treat said.
Treat said those interested in bettering education should “protect the resources that were passed” and also be open to reform. “Just because we’ve passed revenue doesn’t mean we’ve turned a blind eye to efficiencies that can be had,” he said. “It’s not a zero-sum game that you’re either for revenue or you’re for reform. You can be for both.”