OKLAHOMA CITY – Governor Mary Fallin today signed the Fiscal Year 2018 budget bill (Senate Bill 860) into law, which closes an $878 million shortfall, maintains common education funding at current levels, and prevents the closings of hospitals and nursing homes. The 2018 fiscal year appropriated budget will be $6,830,177,825. It is $37,782,641, or 0.55 percent less than the revised fiscal year 2017 appropriated budget, which includes supplementals and the revenue failure.
“Developing a budget in this difficult fiscal and political climate is never easy,” said Fallin. “This plan keeps our government from shutting down and, despite challenging circumstances, funds our core mission services. We worked hard to protect key core services – common education, health and human services and public safety. This budget minimizes cuts and puts some recurring revenue on the table. It repeals certain exemptions in the sales tax code.
“It also modifies the incentives on the gross production tax from 1 percent to 4 percent on current producing wells that were drilled between July 1, 2011, and July 1, 2015,” the governor said. “That will provide about $92 million for the 2018 fiscal year budget. Various rebates for the oil and gas industry that cost the state about $46 million a year have been suspended next year. Of the $878 million shortfall facing lawmakers this session, about $140 million is being made up from the oil and gas industry.
“My top priorities remain strengthening education and workforce, reducing the state’s incarceration rates and improving health outcomes. Whether it’s improving public safety, fixing our roads and bridges, boosting education or raising our health outcomes and indicators, the successes of this session to protect core services in the midst of an energy crisis will help to make Oklahoma a better place to live, work and raise a family,” Fallin said.
“But we missed an opportunity to do more to reform our budget process and find efficiencies,” she said. “We still need to do more to address structural imbalances in the state’s budget, fix problematic tax policies and make available more recurring and stable revenue.
“As this year’s session ends, I’m pleased that legislators approved a fee on cigarettes. Smoking is Oklahoma’s leading cause of preventable death. Lawmakers approving an additional $1.50 per pack is the most important thing they could do to improve Oklahoma’s health ranking,” Fallin said.
2018 Fiscal Year Budget
A Budget that Protects Core Government Services
“It is not an ideal budget, but it avoids draconian cuts to our core services such as education, health and human services, and public safety; unfortunately it leaves many agencies facing cuts for the 6th year in a row. It puts some recurring revenue on the table, but does not address the structural budget challenges that I have been working to fix since I took office. Year after year, I have repeated my warning about our reliance on one-time funding and our eroding tax base, and yet again we have crafted a budget that only fixes some of the defects in our funding formula.
“There is still work to do. When legislators return next year, they will already face a $400 million hole caused by one-time funds and $100 million of obligations coming due over the next 12 months that will need to be paid. Hopefully, in the months that follow they will begin putting together a plan to address the budget and fill that hole.” – Governor Mary Fallin
2017 Policy Highlights
Criminal Justice Reform
Senate Bill 603: Requires all offenders receive a validated risk and needs assessment that will guide providers to programs available to offenders, and mandates the Department of Corrections to create an individualized case plan for each offender.
SB 604: Provides training for law enforcement relating to domestic violence victim safety at the pretrial stage. (pending governor’s signature)
House Bill 2284: Provides training for public defenders, district attorneys and judges. Training is to include substance abuse, behavioral health, and impact and dynamics of domestic violence.
These three measures were the result of recommendations from Governor Fallin’s Oklahoma Justice Reform Task Force. The task force recommended nine other bills, but they failed to win passage, mostly because of resistance from the chairman of the House of Representatives Judicial Criminal Justice and Corrections Committee.
“Our prisons are way over capacity, and our prison population is expected to grow by 25 percent in the next 10 years. Oklahoma’s overall incarceration rate is the second-highest in the country, and we lead the nation in female incarceration – incarcerating women at two-and-a-half times the national average. By 2018, we will have the highest incarceration rate in the country.
“By failing to address these issues, Oklahoma could be forced to build three new prisons over the next decade, at a cost of almost $2 billion to taxpayers if no further action is taken. One of the bills, House Bill 2281, included important sentencing changes to low-level property crimes, and would have had a particularly important impact on our female prison population. Without jeopardizing public safety, with these bills, we could have implemented smart, data-driven solutions to safely and prudently fix our criminal justice system.” – Governor Mary Fallin
Educational Attainment and Improving Oklahoma’s Schools
“A thriving, prosperous economy must have a skilled, educated workforce. That starts with good teachers in the classrooms providing our children a quality education five days a week. We have to ensure more existing dollars are reaching every classroom by tackling administrative inefficiencies head-on.” – Governor Mary Fallin, 2017 State of the State Address
House Joint Resolution 1028: Approves in whole the Assessment and Accountability Report prepared by the state Department of Education and approved by the state Board of Education.
HB 1576: Directs the Commission for Educational Quality and Accountability to adopt rules requiring coursework or training in the use of digital and other instructional technologies as a requisite for teacher program accreditation by Nov. 1. The bill also requires public schools to offer professional development training to teachers on the use of digital resources in classrooms.
HB 1578: Creates a task force of a cross section of educators, business and political leaders to study multiple facets of the State Aid Funding Formula including formula structure, efficiencies and cost saving measures regarding the footprint of school districts. In addition, it creates the School Finance Review Commission for ongoing oversight of school finance including the school funding formula, teacher compensation, benefits and administration costs. (pending governor’s signature)
HB 1693: Revises the A-F school grading system and brings the state into compliance with Every Student Succeeds Act (ESSA) and Elementary and Secondary Education Act (ESEA) standards.
HB 2155: Allows local schools to create the Individual Career Academic Plan (ICAP) for students in grades 6-12 to strengthen college and career goals through various activities.
SB 84 and HB 1760: Increases the accountability measures in the Reading Sufficiency Act (RSA) by requiring a study of students who do not achieve the academic level required to be promoted to the fourth grade; it also makes RSA parent committees permanent and raises the reading level required to pass from limited-knowledge to proficiency in the 2017-18 school year.
SB 301: Expands the Lindsey Nicole Henry Scholarship program, which provides a scholarship for students to a private school of choice, to children who are in an out-of-home placement with the Department of Human Services (DHS) or Office of Juvenile Affairs; or who were adopted while in the permanent custody of DHS.
SB 563: Authorizes school districts, including technology centers, to participate in or administer a cooperative purchasing agreement with one or more public agency.
Improving Health Outcomes
“Our overall health ranking has improved from 49th in the country at the beginning of my term, to 46th today. That’s progress, but none of us are going to settle for a ranking of 46th. Together, we can continue to improve our health. As Oklahomans, we can do better. We all know that we’re facing a tight state budget in the upcoming fiscal year. But that doesn’t mean we shift our focus from our health and wellness. It helps all of us – who are able – to be physically active. It keeps us in shape, helps us deal with stress and improves our chances of being healthy. – Governor Mary Fallin
HB 1703: Establishes a program to promote, incentivize and provide support for pregnancy resource centers, also known as “crisis pregnancy centers,” which assist pregnant women by providing counseling, ultrasounds, prenatal care, parenting classes, maternity clothes, adoption options, and other goods and services.
HB 2039: Allows for Naloxone, a drug that can save lives from opioid overdose, to be prescribed and dispensed by a licensed pharmacist. It also allows pharmacists to dispense medication so as to save people from taking numerous trips to the pharmacy.
HB 2406: Authorizes the development of health insurance stabilization tools in order to reduce or maintain individual premiums, increase health insurer competition in the marketplace, and stabilize the individual market to enable Oklahomans to continue to access health insurance. (pending governor’s signature)
HB 2389: Authorizes a bond issue to finance the construction of a new Department of Health laboratory to replace the department’s antiquated and dilapidated laboratory, which is in danger of losing accreditation.
SB 748: Allows the Department of Human Services (subject to funding) to create a pilot program to improve socioeconomic outcomes for children in state custody.
SB 229: Allows juveniles in the care of the Office of Juvenile Affairs to receive appropriate treatment for mental illness where applicable.
SB 632: Streamlines the process for transfer and/or enrollment of students in state care, including timely delivery of records. It also establishes the Education Compact for Students in State Care Advisory Committee.
SB 773: Directs the development of a Request for Information (RFI) for care coordination models for newborns through children 18 years old who are in the custody of the Department of Human Services.
SB 734: Expands the entities that can employ behavioral health case managers and peer recovery support specialists to include tribal facilities and Department of Veterans Affairs facilities. Also removes the two-year history of addiction time limit placed on an opioid substitution treatment program.
SB 816: Directs medical education residency programs to give priority to in-state students with good academic standing when assigning clinical rotation.
SB 845: Smoking Cessation and Prevention Act of 2017 – The purpose of this legislation is to prevent people, especially children, from taking up smoking.
SB 870: Adds outcome incentive payments to the list of services a parent or legal guardian must pay if a court orders such for their child who is in the custody of the Office of Juvenile Affairs.
HB 1845: Brings Oklahoma into compliance with the federal REAL ID Act while protecting the privacy and freedom of our citizens. Those Oklahomans who are concerned about privacy and liberty will be allowed to opt out and receive a state-compliant ID, but those citizens who need access to federal installations or who desire to travel uninhibited can receive a federally compliant ID.
HB 1468: Creates the hidden predator act; modifies the statute of limitations for rape and forcible sodomy against children to be at the 45th birthday of the alleged victim.
SB 35: Allows for concealed or unconcealed carry for individuals 21 or older with a handgun license or valid military ID.
SB 397: Makes exceptions for firearms carried for self-defense in regards to bus transportation.
SB 643: Improves statewide law enforcement ability to fight impaired driving, per recommendation from the Governor’s Impaired Driving Prevention Advisory Council (GIDPAC). (pending governor’s signature)
Veterans and Military
HB 1198: Directs the Department of Veterans Affairs to create a registry of all veterans in the state, which will include any person who served on active duty in the armed forces, was discharged, or released with an honorable discharge. This creates an accurate listing of veterans in the state, which could have numerous advantages, including more efficient provision of services, reducing fraud, and accurate statistics.
SB 543: Authorizes the Department of Veterans Affairs to establish and maintain a State Veterans Cemetery. Funding will be sought through the Veterans Cemetery Grants Program provided for by the U.S. Department of Veterans Affairs. Such grants will be used by the state of Oklahoma to provide a final resting place for Oklahoma veterans in commemoration of their service to our nation.
SB 690: Instructs the State Regents for Higher Education, Oklahoma Military Department, and schools of social work to develop a Guard advocacy program for Oklahoma National Guard soldiers and airmen. The program will allow Oklahoma universities with social work programs to partner with the Oklahoma National Guard to allow social work students to assist National Guard soldiers and airmen through behavioral health issues while working on their required social work practicum.
“Government can always find ways to save taxpayer dollars by operating more efficiently and effectively. The reforms we continue to pursue on a state level will help to produce more flexible and responsive state agencies, eliminate government waste and save money.” – Governor Mary Fallin
HB 1533: Requires the state bond adviser office and the Office of Management and Enterprise Services to create a debt affordability study to analyze Oklahoma’s debt position.
HB 1720: Allows insurance companies to provide a discount, rate reduction or other related adjustment for new insurable property built to resist loss due to tornado or catastrophic windstorm events, only when the company determines the discount or reduction to be actuarially justified.
HB 1833: Abolishes the Council of Firefighter Training and transfers those duties to the state fire marshal’s office.
HB 2298: Sunsets the tax credits for the wind industry on July 1, 2017.
SB 867: Expands laws for horizontal drilling, adds rights for vertical well owners and creates protections for mineral rights owners.
HB 1388: Modifies the nuisance provisions for agricultural operations. The purpose of modifying these provisions is to provide protection to farmers and ranchers from frivolous and malicious lawsuits against their operations should they expand or introduce new technology to the operation.
HB 1431 and HB 1994: Completes the process or privatization for the Oklahoma Sorghum Commission and the Oklahoma Oilseed Commission. Privatizing the commissions to a non-appropriated agency saves money in the state budget and gives the commission freedom to retain any earned income.
SB 326: Prohibits the possession or importation of exotic swine. This bill protects Oklahoma’s domestic livestock and native wildlife from foreign diseases. In addition, it guards against the potential threat exotic swine pose to private and public property, historic landmarks and the ecosystem by rooting near waterways, causing increased erosion and contamination of water sources.
SB 595: Provides protection to farmers’ markets registered with the Oklahoma Department of Agriculture, Food and Forestry. It also adds an assumption of risk for farmers’ market attendees so they cannot hold the market responsible for inherent risks.
SB 153: Removes the requirement that the Tourism and Recreation Department use monies collected from entrance or day-use charges at state parks for capital improvements. This allows the revenue to be used for operations in parks where the fees are generated.
SB 872: Moves ownership of the American Indian Cultural Center and Museum to the city of Oklahoma City, relieving the state of its future financial responsibility.
Economic Development and Commerce
HB 1681: Directs the Oklahoma Aeronautics Commission to administer an airport inspection program for all public-use airports in the state of Oklahoma.
HB 2351: Allows every county, not just those with populations of 500,000 or more, to establish a tax incentive district. This helps level the playing field for suburban and rural counties seeking to attract new industries.
SB 120: Maintains the job-generating tax incentive to employers and employees in the aerospace industry by extending sunset date on the tax credit until Jan. 1, 2026.