Sunday, August 23, 2009

Senator Gumm's "Senate Minute" - September Special Session Likely

DURANT, Okla. – Hello again, everyone! Last week, I wrote that no one is talking about a special session to adjust the state budget in light of the revenue shortfalls.

This week, almost everyone is talking about whether lawmakers should return to the Capitol. Initially, it looked as though the governor would call the Legislature into special session beginning on Monday, August 31. Within a few hours, however, it began to appear that a slower “wait-and-see” approach would prevail.

Finally, the governor announced the question of “if” we return for special session would be answered after the tax revenue numbers for next month are known. Should we have another shortfall – a situation in which the state collects less than what is necessary to meet the conservative budget approved in May – a special session in September is very likely.

If that happens, a number of decisions will be before my colleagues and me. The initial decision would be about having the session in the first place.

The state Constitution provides a means by which the budget is balanced during a revenue failure. That method is automatic and even cuts across the board for all state agencies in order to balance expenditures with the money coming in.

Calling a special session means that the first decision made is that some functions of state government would be protected over others. My stand is that things like public education and public safety should have the highest of priorities; those functions should be the last and least cut.

In a special session, the next decision would be whether to simply adjust the cuts among state agencies or use some of the resources available to plug budget holes. Unlike many of our sister states, we do have money that could be used to help ease budget cuts.

The good news is that Oklahoma has a full “Rainy Day Fund” which could be tapped to help alleviate some cuts. Also, about half the stimulus money allocated to Oklahoma is remaining and could be used.

The bad news is if we use money from either of these pots, it would be gone for good. Using “one-time” money for recurring expenses, things state government pays for every year, is somewhat risky. Doing that means there would have to be some reason to be optimistic about future revenue numbers. In short, have we “hit bottom” yet?

If we decide to use Rainy Day or stimulus money, the final question before us would be to decide which agencies get those dollars and how much do they get. While none of this is rocket science, none of these decisions are easy ones.

Oklahoma is indeed in better shape than most of our sister states. The greatest challenge for us is to ensure that our budget picture, despite this rough patch, remains among the strongest of all the states.

Thanks again for reading the “Senate Minute.” Have a great week, and may God bless you all.

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