Step Down: Revenue bill short again in Oklahoma House

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(Update: This story was updated at 8 p.m. to note new lengths of time and potential negotiations around the revenue bill. It was updated again at 11:05 p.m. to note that the vote ended.)

The primary revenue bill included in the Step Up Oklahoma plan has failed to receive 76 votes in the House of Representatives today, the second time in fewer than 100 days that a major revenue bill has fallen short.

The vote sat at 63-35 for almost seven hours with two members — Rep. Chuck Hoskin (D-Vinita) and Rep. Carl Newton (R-Cherokee) — not having voted. Earlier in the day, Newton’s legislative assistant said he was in the hospital awaiting surgery.

The vote began about 4:25 p.m. By 6 p.m., members of both parties milled about the fourth-floor rotunda, expressing confusion as to how long the vote could be held open. By 8 p.m., word spread that House Democrats — who have initially voted 10 for and 17 against the proposal — are being negotiated with to come on board for the revenue bill’s passage. At 9:30 p.m., GOP leaders hosted a press conference.

House rules state that votes cannot remain active beyond midnight. Many members left the Capitol or indicated that they are preparing to leave.

‘I actually believe this is our only shot’

“I believe this is the best opportunity and the best hope that we have to pass recurring revenue,” said House Appropriations and Budget Chairman Kevin Wallace (R-Wellston) who presented HB 1033XX. “I actually believe this is our only shot.”

Several House Democrats expressed skepticism at Wallace’s statement.

“Would you agree with me that it is a little disingenuous to say this is the last opportunity when this is February and session runs through May?” asked Rep. Forrest Bennett (D-OKC).

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Rep. Casey Murdock (R-Felt) entertained the same line of thought.

“When does the state treasurer certify the board of equalization’s numbers? When do we get those numbers on the budget?” Murdock asked Wallace, who said the BOE meets Feb. 20. “What’s the rush on this? Why can’t we wait until they meet and have those budget numbers? That’s days away, so what’s the rush?”

Murdock, who is running for Senate in an election Tuesday, voted against the bill.

“I do not disagree that we need revenue. I do not disagree that our teachers need a pay raise. Our state employees need a pay raise,” Murdock said. “But we need to vet this.”

In November, Murdock voted in favor of “Plan A+,” a compromise that the oil and gas industry opposed and helped prevent from reaching 76 votes. That measure finished with a 71-27 on Nov. 8.

But industry leaders supported Step Up Oklahoma, which includes a new tax on wind generation, a series of government reforms and enough money for a $5,000 teacher pay raise.

In his first debate as House Speaker, Charles McCall (R-Atoka) urged lawmakers to recognize those parts of the Step Up proposal.

“I’m debating now because it is not time to be silent. This is time for action. This is the time to finally give our hard-working teachers a pay raise. This measure includes funding for a $5,000 pay raise to bring us up beyond the regional average,” McCall said. “It is past time to do the right thing for professional educators who shape the future of this great state.”

McCall addressed House Democrats directly.

“I understand this package doesn’t include everything you would like to see. I understand this package includes some things that you would not like to see in it. But you and I have that in common,” McCall said. “It is time to quit the rhetoric. It is time to quit the cop outs and the excuses. Today, you can do something about the situation in the state of Oklahoma.”

Other representatives debated in favor of the bill while emphasizing its imperfection.

“We have had budget deficits for five years. We have fixed those budget deficits with resources I would describe as bailing wire and bubble gum,” said. Rep. Meloyde Blancett (D-Tulsa). “We’re in a canyon-sized cavern with a ladder, and this gets us about three steps up the ladder”

Rep. Michael Rogers (R-Broken Arrow) voted against the revenue bill in November but debated in favor Monday, saying that arguments against the Step Up plan are not making logical statements.

“It’s like saying you’ve got to take a trip across the country but you don’t want to fly because you don’t like peanuts,” Rogers said. “That’s ridiculous.”

Rep. Emily Virgin (D-Norman) voted “yes” in November but debated against Monday’s revenue bill immediately after Rogers, poking him for his flip.

“As I remember, there were a few from the other side of the aisle who voted against a teacher pay raise just a couple of months ago and now they are for it,” Virgin said. “And why is that? From what I can gather, it’s because the oil and gas industry signed off on it.”

While 23 Democrats voted in favor of November’s revenue bill, only 10 did so today.

How they voted

Background

Lawmakers technically voted on the Step Up Oklahoma package in a concurrent special session that started in December. The Legislature has yet to complete its Fiscal Year 2018 budget following a veto from Gov. Mary Fallin to conclude 2017’s first special session. That special session was necessitated by an Oklahoma Supreme Court decision that ruled in August the Legislature’s 51-vote “cigarette fee” was unconstitutional.

Oklahoma’s FY 2018 ends June 30, but state budget staff have told lawmakers that at least three agencies will need millions of dollars by April: the Oklahoma Health Care Authority, the Oklahoma Department of Human Services and the Oklahoma Department of Mental Health and Substance Abuse Services.

The Legislature remains in its regular 2018 session, which started Feb. 5 and runs through May.

‘A plan that can pass’

Hours ahead of Monday’s big Step Up vote, the conservative think tank Oklahoma Council of Public Affairs held a press conference to announce what it called “a plan that can pass,” which would pare a revenue package down into five components:

• A gross production tax increase to 5 percent for existing wells taxed at 2 percent and for all future wells for 36 months and 7 percent thereafter;
• A $0.75-per-pack cigarette tax increase;
• A $10 million cap on the zero-emission tax credit for wind facilities;
• A ballot measure dedicating all “new tobacco settlement payments” to the state’s Medicaid budget. The payments currently go to the Tobacco Settlement Endowment Trust.

OCPA President Jonathan Small said his organization’s executive committee approved the proposal he released Monday and that it represented the will of “a majority” of OCPA members.

“This plan represents what the OCPA thinks should be done if taxes have to be increased,” Small said. “OCPA did not take an official position on Step Up. One of the big reasons we didn’t is that Step Up has changed so much since it was introduced. It’s so difficult in a political environment to play whack-a-mole in a political package.”

Small said the original Step Up proposal included education savings accounts, Medicaid audits, appointment of the state superintendent of public instruction and other items.

“That’s all gone,” Small said. “So someone could argue that Step Up isn’t even in existence at the Capitol anymore, at least as it was originally proposed.”

Asked if OCPA had found an author for its proposal, Small said not yet.

“We didn’t want to try to project those proposals on one lawmaker individually thus resulting in some person taking offense because one person was chosen over another,” he said.

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