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Budget woes remain top priority for Legislature

By Terry Groover

Staff Writer

With just a few weeks remaining in the legislative session, Sen. Stephanie Bice said Tuesday there is plenty of work to do, including closing a massive state budget deficit.

The Legislature must adjourn by May 26.

Bice, R-Oklahoma City, was one of several lawmakers attending a legislative breakfast Tuesday that was sponsored by the Yukon Chamber of Commerce.

Bice and Rep. Rhonda Baker, R-Yukon, updated the audience about the state’s legislative session, while representatives for Sen. James Lankford, R-Oklahoma City, and Rep. Frank Lucas, R-Cheyenne, discussed federal issues.

The major concern, Bice said, is the state’s budget hole.

Bice said that there was an $878 million shortfall from last year, but that doesn’t include about $100 million that was supposed to be matched by the federal government for programs like Medicaid reimbursement.

“That $878 million number that we’ve been hearing about is really not accurate. It is really more like $978 million. So we’re essentially a billion dollars in the hole,” Bice said.

Bice said the Legislature currently could not fund the top six agencies. All of the other agencies would be zeroed out.

“This is where we are. It is not an easy time for any of us,” Bice said. “We’ve got to fix the problem this year, but we also need to look long term too figure out how do we properly fund the agencies, how do we fund school. How do we keep this state operating properly.”

The senator said the state must make significant changes in the tax code to bring in additional funds.

Among the items being considered are elimination of certain tax credits and itemized deductions from the state income tax, as well as potential increases in the gasoline tax and the cigarette tax.

“Keep in mind, those things will not fix a billion dollars in shortfalls,” Bice said.

There also has been talk about raising the gross production tax. However, because the energy industry is currently struggling, an increase in that tax would not provide much benefit to the state’s economy.

Bice said one potential change would affect the transportation department. Currently, the department is funded through the general budget. There is a proposal to do a “swap,” where the state would remove those funds from the transportation department and use a 6 percent increase in the gas tax to fund the department.

The difference would provide about $120 million to the state’s budget.

The lawmaker said the department has approved the proposal.

Baker said the House is facing a challenge with some Republicans.

“You have a group of Republicans who don’t want to raise any kind of tax, and that’s what they ran on. … Then you have another group that says ‘we have cut our services to the bone, and if we don’t raise some revenue, we’re just dying.’ … And then you have the Democrats who have their talking points,” Baker said.

Negotiations between the three groups are ongoing, Baker said.

Much of the concern involves the tax increase proposals, because they would hit low- to middle-income residents the hardest.

Baker said raising the fuel tax six cents would not hinder most people.

She said Oklahoma has among the lowest fuel taxes in the nation.

Many of her constituents, she said, are pushing for an increase in the gross production tax. However, she said a better option would be to eliminate some of the tax credits provided to energy companies because it would provide more funding.

At the federal level, Steve Carson, who is a spokesman for Lankford, discussed the recent appointment of U.S. Supreme Court Justice Neil Gorsuch, as well as more than 1,200 federal appointments that have not made their way through Congress.

Carson said never before had there been filibusters to hold up appointments.

Carson also pointed out that President Donald Trump’s budget has arrived. The 1,665-page document is unlikely to be approved, simply because no presidential budget has ever been approved.

Also, he said that proposals for a revised health care plan are in the works and could be ready for consideration in June. The House actually approved a healthcare plan on Thursday. It’s fate in the U.S. Senate is unclear.

Kirby Smith, who represents Lucas, said during recent town hall meetings, the healthcare proposal was a hot topic.

“The reality is, we don’t know what it’s going to look like,” she said.

It is likely that elements of the Affordable Health Care Act will remain, including allowing children to remain on insurance until they are 26 years old and pre-existing conditions.

“Those are two very expensive pieces,” she said.

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