The Governor’s First Offer

The Governor’s First Offer

By State Rep. Mike Sanders

Though the start of session was relatively calm, Governor Brad Henry’s proposed budget hinted at a hiccup in the negotiations between his office and the Legislature’s conservative leadership.

Conservatives in the Legislature look to make targeted cuts in response to the revenue shortfall and hope to use less of the Rainy Day fund to fill holes. With little idea of how long the shortfall will continue, this seems like the most prudent course. It’s expected we could face another $600 million budget hole next year because stimulus funds will have to be replaced. If so, maintaining some money in the Rainy Day fund this year will be crucial. In the governor’s proposed budget, 80 percent of the Rainy Day fund will be immediately used to stave off painful yet necessary cuts.

To be clear, there are many things that Governor Henry and lawmakers agree on. The Legislature plans to do the utmost to protect education funding. By targeting cuts to less essential services and taking advantage of stimulus dollars, education should come out of the budget process in much better shape than other agencies, including the Legislature and the Governor’s Office, both of which will take a large cut. The governor also wants to consolidate a number of agencies, which conservatives support.

One area where rural lawmakers on both sides of the aisle differ with Governor Brad Henry is on the funding of the Rural Economic Action Plan. Last year, you may remember, an effort was made to remove it from the budget. Rural lawmakers fought to get it back in and were successful. REAP received the same 7 percent cut as most state agencies. Funding for the program was generated through an increase in the fine for delinquent tag renewal, which increased from 25 cents to $1 a day. Of the 75 cents increase, 50 cents went to REAP while the other 25 cents would stay with the tag agent. Governor Henry’s proposed budget this year zeroes out REAP funding. We plan to fight and save it again.

Lastly, I will note the Governor’s tactful omission of any discussion of workers’ compensation legislation in his State of the State address. I think that despite the importance of this legislation in attracting business to the state and improving the time it currently takes to get benefits to injured workers, it will likely be an item of contention. Many attorneys support Democratic candidates with campaign contributions, and workers’ compensation attorneys would lose a cash cow if this legislation passes, although injured workers would be better off.

But, on a positive note, I do believe the Legislature and Governor Brad Henry will resolve their differences on the budget. Often, the governor’s proposed budget is like the beginning of a barter. He gives the Legislature an offer and they return with something a bit different. My hope is that by the end of the year, the budget will include REAP funding and will draw less on the reserve funds we may need in the next couple of years.

I will keep you regularly updated on the activities of the Legislature through this column. As always, I would love to hear from you. I can be reached at the Capitol at (405) 557-7407.

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