Legislation and Votes from This Week at the Special Session
After the first round of bills had been defeated or became irrelevant after the funding bill failed, a second round of legislation was filed in the House along with some Senate bills that weren't direct appropriations as the Senate is prohibited from filing money bills. Here are the last set of bills filed and defeated for the most part:
This is an extraordinary bill, the largest tax hike in Oklahoma history, that sets increased taxes on cigarettes, little cigars, chewing tobacco, low point beer, and motor fuels such as gas and diesel. This is the same tax that failed earlier in the week with an added Gross Production Tax (GPT). The proposed rate for GPT for wells was 4%, doubled from 2%, for the first 36 months at which time the production falls by 87% and the oil companies will be willing to pay the regular 7% GPT.
It places a new sales tax on cigarettes in addition to the existing state and federal excise taxes, a new sales tax at about 7.5 cents per cigarette or $1.50 per pack or $15.00 per carton. It places a new sales tax of 10% on chewing tobacco in addition to the excise taxes already paid and raises the little cigar taxes to the same rate as cigarettes which appears to mean the excise tax AND the new sales tax. The new money will go to the General Revenue Fund up until July 1st 2018, then it is redirected to the Health Care Enhancement Fund. So after July 2018 the state can poor mouth and demand another revenue stream I suppose. Now remember, a State Question once removed the sales tax on cigarettes in exchange for quadrupling the excise taxes, which we were told would fix the long term funding forevermore.
Gas and diesel fuel will have a new sales tax of six cents per gallon added to the existing excise state taxes of about 17 cents along with the federal excise taxes on fuel. The money will be siphoned off into the General Revenue Fund until July 1st 2018 before it starts being deposited into the road and bridge fund.
The bill adds a new sales tax on low point beer. Existing excise tax on high point beer is $11.25 per 31 gallon barrel to a 13.5% sales tax. The excise tax brings in around 20 cents per six pack of high point beer. Existing tax on low point beer is around 58 cents per six pack. Now 94.5 cents will be added to the six pack at the cashier. That is nearly doubling the tax on beer.
And as we have already mentioned that bill had increased the GPT from 2% on new wells to 4%, down from 7% on existing wells. Immaterial as the bill failed in committee.
YEAS:11
Caldwell, Casey, Cockcroft, Dunnington, Echols, Ortega, Osborn L, Ownbey, Roberts D, Sears, and Watson.
Nays: 11
Calvey, Hall, Kouplen, Lepack, Loring, Murphey, O'Donnell, Pfeiffer, Proctor, Stone, and Virgin.
The cigarette sales tax is expected to bring in $107,434,000 for the 2018 budget year,
$243,516,000 for 2019, the little cigar tax ought to bring in $694,000 in 2018 budget year money and $1,665,000 in 2019 budget year, chewing tobacco sales tax ought to bring in $3,733,000 and $11,200,000 respectively, the new gas and diesel sales tax will bring in $56,810,000 and $170,430,000 respectively, the low point beer sales tax increase from 4.5% to 13.5% (plus any county or city sales tax) will bring in $3,364,000 and $13,456,000 respectively, and the increased GPT tax would have brought in $186,627,000 and $454,859,000 respectively. And mixed in with the state estimates was a mention of an additional $14,592,000 from an increase in the mixed beverage tax so we must have missed that part when reading the bill.
And the picture that says it all if you were a conservative Oklahoman last week:
Rep Jason Murphey enjoying a conservative victory while bill author/committee chairman Kevin Wallace and Chris Cannaday try to figure out how they will explain not voting to break the tie vote
Next up was HB 1055
HB 1055 would have provided a $3,000 salary increase to certified teachers effective August 1st, 2018. They figured $148,426,00 for the actual salary, plus $14,005,470 added to the retirement system fund, and another $11,278,089 for the FICA and that is PER YEAR from now on, not just one year. The total cost was $158,317,096 in increased spending.
Where else but in Oklahoma are the special interests so powerful that a special session devoted to fixing a multi hundred million dollar budget hole has an additional two hundred million in new spending attached to the proposals?
The committee vote was 17 to 7, short of the 18 votes needed to move the bill out of committee by showing that the bill had 75% popular support in the House. Technically it can be placed on a floor vote I guess but not without the funding by new tax increases or new taxes passed first.
Voting for the bill were Caldwell, Casey, Cockcroft, Dunnington, Echols, Hall, Kannady, Loring, O'Donnell, Ortega, Osborn L, Ownbey, Pfeiffer, Roberts D, Sears, Wallace, and Watson.
Against the bill were Calvey, Kouplen, Lepack, Murphey, Proctor, Stone, and Virgin.
Next up was HB 1056
A pay raise for 30,401 fulltime or temp employees, $1000.00 per year, projected cost of $34,949,363 including $27,867,583 for the salary part, $4,598,151 for retirement plan, and $2,483,628 for FICA. It passed 16 to 8
The yes votes were:
Caldwell, Casey, Cockcoft, Dunnington, Echols, Hall, Kannady, Loring, Ortega, Osborn L, Ownbey, Pfeiffer, Roberts D, Sears, Wallace, and Watson.
The no votes were:
Calvey, Kouplen, Lepack, Murphey, O'Donnell, Proctor, Stone, and Virgin
HB 1057 was next:
This is on the Earned Income Credit, the refundable part that was repealed in 2017. The amount is paltry, 5% of the federal earned income tax credit. But there are a lot of people that could take it so the estimated impact is $28,311,000 for the next year. However, this is not a spending increase per se, it is the repeal of an ill thought out tax increase in 2017. Not repealing that 2017 tax increase will impact 335,749 low income citizens in Oklahoma in early 2018. It passed committee 21 to 3. That said, there is a valid argument that this is an unearned income tax credit as the people are getting back more than they paid in so we would not use this bill on our RINO Index as it is merely correcting a wrong.
The yes votes on HB 1057 were:
Casey, Cockcroft, Dunnington, Echols, Hall, Kannady, Kouplen, Lepak, Loring, O'Donnell, Ortega, Osborn L, Ownbey, Pfeiffer, Proctor, Roberts D, Sears, Stone, Virgin, Wallace, and Watson.
The no votes were:
Caldwell, Calvey, and Murphey.
Next up was HB 1058:
HB 1058 returns the Department of Human Services (DHS) to the 2017 funding levels, restoring all funds that were cut by the agency after the budget shortfall was announced. Around 70 million dollars are involved.
However, SB 1032 had already passed the Senate and Republican Speaker Charles McCall could have ended the special session by putting that bill up for a floor vote as DHS was the only agency that was hurt that actually impacted state core services. McCall refused, just like two of House Leadership's men refused to vote on HB 1054 in committee, enough to break the 11 to 11 deadlock and pass the massive tax increase out of committee and force a floor vote. We were told that Kris Cannady was one that refused to vote and break the deadlock. Something us up, someone is playing checkers while the Senate plays chess. The bill passed 20 to 4 and could have been sent to the House floor for a vote and on to the Senate. As the 70 million is coming out of Rainy Day funds and one time source funding the money was there to pay the bills so there was no reason not to do two floor votes and close out the special session. Except one reason, Fallin had already threatened to veto anything that was passed that was not on her plan for the special session....bitch.
The yes votes were:
Caldwell, Calvey, Casey, Cockcroft, Dunnington, Echols, Hall, Kannady, Lepak, Loring, Murphey, O'Donnell, Ortega, Osborn L, Ownbey, Pfeiffer, Roberts D, Sears, Wallace, and Watson.
The no votes were:
Kouplen, Proctor, Stone, and Virgin.
Senate bills voted on this week were:
SB18
SB 18 moved $23,338,170 out of the Rainy Day Fund into the OMES, Office of Management and Budget, probably for the DHS funding. It passed 12 to 6.
Yes votes were:
Biggs, Caldwell, Calvey, Casey, Cockcroft, Echols, Kannady, Lepak, Pfeiffer, Roberts D, Sears, and Wallace.
No votes were:
Dunnington, Kouplen, Loring, Proctor, Stone, and Virgin.
Next up was SB 23
SB 23 was the removal of the sales tax exemption on gasoline. In the 20018 budget year it will raise $60,610,000 and $181,829,000 minus a few million paid back to the tribal allocation on gas tax. The money goes into the General Fund like the earlier bill until August 2018, then the money is diverted back into the road and bridge fund. It passed 10 to 9.
Yes votes:
Caldwell, Casey, Cockcroft, Echols, Hall, Kannady, Pfeiffer, Roberts D, Sears, and Wallace.
The no votes were:
Biggs, Calvey, Dunnington, Kouplen, Lepak, Loring, Proctor, Stone, and Virgin.
SB 30 was up next
SB 30 was an appropriation to the Health Care Authority, another of the agencies that was hit the hardest in the budget shortfall caused by the unconstitutional tax increased passed by House and Senate leadership in the spring of 2017. It was for $29,490,000 going to OHCA from the General Fund. The vote was 13 to 6.
The yes votes were:
Biggs, Caldwell, Calvey, Casey, Cockcroft, Echols, Hall, Kannaday, Lepak, Pfeiffer, Roberts D, Sears, and Wallace.
The no votes were:
Dunnington, Kouplen, Loring, Proctor, Stone, and Virgin.
Next up was SB 32
SB 32 sent $24,940,000 to the Department of Mental Health and Substance Abuse, from the General Fund. It passed 13 to 6, once again like the previous two bills, this fixed the budget short fall for 2017 and the first half of 2018 so McCall and Schultz could have passed these three bills and sent everyone home.
The yes votes were:
Biggs, Caldwell, Calvey, Casey, Cockcroft, Echols, Hall, Kannady, Lepak, Pfeiffer, Roberts D, Sears, and Wallace.
The no votes were:
Dunnington, Kouplen, Loring, Proctor, Stone, and Virgin.
Last was SB 34
SB34 was another transfer to DHS to fill the cuts made earlier in the year, $29,070,000 from the General Fund, passing 13 to 6.
Yes votes were:
Biggs, Caldwell, Calvey, Casey, Cockcroft, Echols, Hall, Kannady, Lepak, Pfeiffer, Roberts D, Sears, and Wallace.
The no votes were:
Dunnington, Kouplen, Loring, Proctor, Stone, and Virgin.
