House, Senate GOP leaders reach agreement on budget — with no income tax cut
Roughly two weeks and seven meetings after the governor called a budget summit and, with just a few days remaining in the 2024 legislative session, negotiators from the House and Senate reached an agreement Wednesday on how to spend roughly $13 billion in revenue.
That agreement, however, doesn't include a second tax cut.
Championed by Republican Gov. Kevin Stitt since the session began, a .25% cut in the state's personal income tax proved to be a non-starter in mid-February when Senate Pro Tempore Greg Treat said he didn't think there was enough money to fund cuts in both the grocery sales tax and the personal income tax.
Though Stitt continued to push for an income tax cut — up and through the first three budget summits — Treat refused to yield even after being peppered with questions from House Budget Chairman Kevin Wallace and Speaker Charles McCall.
"Governor, it's like I've tried to tell you since Day One, you don't run the Senate chamber," Treat said last week. "I decide what goes up for a vote on the Senate floor with the consultation of my caucus."
By the fourth budget summit, Stitt and McCall were no longer in attendance. Negotiators began working their way through the line items, agreeing or eliminating spending in each area. Lawmakers met again briefly, on Monday, following after a terse weekend meeting. Still, there was no agreement on the budget
Then on Wednesday, things changed.
Stitt, who returned to the summit, dropped his push for a tax cut and, instead, told lawmakers he would sign the budget if lawmakers would agree to allocate $20 million to the governor's Quick Action Closing Fund, cap judicial pay increases at 7% and limit those increases to members' district judges, continue to fund tribal litigation efforts and create a task force to create a state business court.
Treat, who seemed surprised by the offer said, "that doesn't sound unreasonable at all."
Eventually, both the House and Senate agreed with the governor's request which, in turn, dramatically changed the tone of the negotiations. Stitt's request removed the pressure to push for a second tax cut — at least this year — and it eliminated Treat's biggest concern that Stitt would veto the budget bill and lawmakers would have no way to override those vetoes.
Last week Treat pushed the House delegation to agree to possible overrides, but McCall said no. Stitt's action on Wednesday eliminated that worry, allowing the budget deal to quickly come together.
"This is the way the process is supposed to work," the governor said after the summit. "We all can adjourn for the session, and we're all friends and fellow Oklahomans."
McCall called the agreement "the culmination of those robust negotiations."
"I want to applaud the hard work of our House negotiating team and budget staff for getting this across the finish line," McCall said in a media statement. "The House showed our commitment to transparency and good faith throughout the process, and we are thankful that a deal was reached.”
A closer look at how Oklahoma funds will be spent under budget agreement
Though legislative staff continue to finalize the details of final appropriations bills, some details have surfaced, including:
Education: The next budget earmarks $3.823 billion for the state's common education system. That was after the Senate stood down from its request for $99.6 million to fund a $2,500 stipend for school support staff. The budget also includes an appropriation of $18.846 million for the Center for the Advancement of Science and Technology and $7.172 million in funding for the Oklahoma School of Science and Mathematics. In addition, lawmakers earmarked $27.6 million for CareerTech to address its waitlist and admit more students; $20 million for animal diagnostics lab at OSU’s College of Veterinary Medicine and $1.5 million to support educational initiatives that increase awareness about the Oklahoma City bombing and its impact.
Health: The new budget allocates $30 million for the Oklahoma Health Care Authority to increase long-term care provider rates; $30 million expansion for OSU Medical Center in Tulsa; $18.5 million in additional funding for the Department of Mental Health to address children’s mental health needs; $15 million additional funding for Choosing Childbirth, to provide services to pregnant women; $45.5 million to increase reimbursement rates for developmental disability service providers and $3 million in new funding to get roughly 300 additional individuals developmental disability services.
Transportation: Transportation is set to receive $883.4 million for FY 2025, while Service Oklahoma — the same agency that now issues driver's licenses ― will have an appropriation of $52.84 million.
Emergency management: The Legislature and the governor’s office agreed to earmark $45 million for emergency management, following the tornadoes that have hit the state this year.
More: Budget summit highlights divisions, priorities between Legislature and governor's office
Public Safety: Though they disagreed with the House, the Senate's team agreed not the claw back $49 million in funds that had been appropriation for construction of a Department of Public Safety tactical training facility and signed off a $74 million allocation for phase two of the project. Total cost for the project is more than $133 million. The training facility that would be used to train Oklahoma Highway Patrol officers, officers from the Oklahoma State Bureau of Investigation and those from the Oklahoma Bureau of Narcotics and Dangerous Drugs Control.
The Public Safety Department controversy surfaced this week after the agency's commissioner, Tim Tipton, publicly criticized the Senate after Senate Majority Leader Greg McCortney said lawmakers should stall the project.
"I've never seen political posturing in my time that has to do with posturing on the side of defunding law enforcement on a project that's already been funded," Tipton said.
Wednesday afternoon, Treat said he was proud of the final budget. He thanked Stitt for his change of heart, saying he had not expected the governor to change positions.
"We had expressed concern about his potential veto in here and we were trying to get the House commit to override, but the much better approach was what was reached today," Treat said. "We're very happy that came together over the last couple of days."
He said the budget made critical investments in deferred maintenance, put additional money in the education formula for some teachers who didn't get pay raises, kept back $1 billion in cash and passed the largest tax cut in state history.
Senate Minority Leader Kay Floyd said Democrats were pleased the agreement "should negate the need for yet another costly special session," but added that Democrats were concerned the budget doesn’t address critical needs facing residents in every district of the state.
"This is not a bipartisan budget, because it misses important opportunities to invest more in our schools, health and mental health, and other programs that would have improved the lives of working Oklahomans and their families," she said.
The second session of the 59th Oklahoma Legislature ends next Friday.
This article originally appeared on Oklahoman: Oklahoma lawmakers reach budget agreement without tax cuts
