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Oklahoma Budget
Oklahoma Budget
Chad Hance
Tuesday, May 16, 2017

Five days to find revenue: Oklahoma lawmakers hoping for a deal in last days of session

Dale Denwalt by Dale Denwalt 

Oklahoma lawmakers have until Friday to find about a billion dollars' worth of revenue or adopt a budget with more agency spending cuts, an act that could draw a veto from Gov. Mary Fallin.

The past few weeks of session have been fraught with tense negotiations and false starts on new revenue as budget writers in the House, Senate and governor's office try to cobble together a coalition willing to raise taxes while curtailing valuable tax incentives.

So far, however, Fallin has received and signed bills that amount to just 5 percent of the estimated budget gap.

Because lawmakers have so few days to find revenue and write a budget, it's common for the outlook to change daily, or even several times each day. The Legislature must adjourn for the year by May 26, and no revenue bills can be sent to the governor in the last week of session.

Here's where the Legislature is, as of adjournment Friday:

Despite months of bickering about where to find the bulk of money, House Republicans and Democrats say they are mostly together on about $400 million in revenue. However, that includes an estimated $215 million in higher cigarette taxes that may not have full Democratic support yet.

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Even the $400 million number is disputed, Senate Floor Leader Greg Treat said Friday.

"A lot of times people will conflate and push in the itemized deduction into there," said Treat, R-Oklahoma City. "But it's my belief in talking to our counterparts in the House that the itemized deduction can pass separate and apart from that agreement.”

Stay Informed: Read all the coverage from the Oklahoma state capitol

Meanwhile, Fallin continues her media push urging lawmakers to do their job and send her revenue bills.

Third parties do their part, too. Every day, especially in the last few days of session, constituents and advocacy groups have stood alongside lobbyists in the white marble halls of the Capitol building hoping to influence those in charge of the budget.

The Senate met for an unusual Friday session while House leadership and budget committee chairs huddled in the speaker's conference room. Later in the day, Speaker Charles McCall and Senate President Pro Tem Mike Schulz went to the governor's office for another meeting.

There were no big announcements despite a long week of revenue frenzy.

Other options

There are still ways for lawmakers to raise a billion dollars, if that's what they want. Aside from the ideas that have dominated headlines for the past month, they could eliminate some service tax exemptions.

Fallin suggested it in February, but the idea quickly went south. There are 51 services that are taxed by the Texas government but not by Oklahoma. If lawmakers here begin taxing those same services, they would have close to $350 million in new revenue to appropriate.

The Legislature could also literally let the people decide. Because bills that raise taxes need a supermajority to pass, lawmakers could put ideas on the ballot.

A legislative referendum to raise taxes only takes a simple majority vote in the House and Senate. That would trigger a statewide election where voters could vote for, or against, tax increases.

The Legislature could also give up on filling the budget shortfall, pass a budget that includes significant spending cuts, await the governor's veto and then override it.

The governor's veto power might play a bigger role in the political calculation, however. A person familiar with negotiations said some lawmakers are holding out for a budget they know will get vetoed. That way, when faced with no other option, they would have cover to raise taxes during a special session in June.