Deal, or no deal? Revenue raising measures in jeopardy

The Oklahoma State Capitol building (KOKH/File)

The week ends with no deal on a state budget and a shaky deal to raise revenue is on even more unstable ground.

The state senate approved a measure to cap itemized income tax deductions at $17,000, but added exemptions for donations to nonprofit organizations.

However that plan would fill just one hundred million dollars of the nearly billion dollar budget hole.

It takes 76-votes to raise new money in the House and there are just 72 elected Republicans and no guarantee all the GOP Representatives would agree to raise taxes. That means the majority party needs the support of the 26 Democratic Representatives.

House Speaker Charles McCall, R-Atoka, said he believed the House had a bipartisan deal in place to raise revenue. The plan hinged on a deal that would allow for “Vegas-style” gambling at Oklahoma’s tribal casinos.

“That piece unlocks, that brings Democrats to the table on the tobacco vote,” McCall said of the tribal gambling compact proposal, “In the tobacco tax vote that we are contemplating in that package is $210 million annually.”

However, on Friday, the Oklahoma Senate voted that part of the plan down.

House Democratic leaders say the gambling bill was never the key to getting their votes.

“Our caucus said we would support that,” Representative Scott Inman, D-Del City said of the tribal casino compact change, “But that is not what unlocks the budget box.”

Inman, the House Democratic Minority leader said the gaming bill would only allow for $20 million additional revenue. “What we've got to do is get the state focused on gross production taxes,” Inman told FOX 25.

Speaker McCall said raising gross production taxes from their current two percent levels would hurt the recovery of the oil industry and would not amount to enough money to make a difference. He insists an increase of two percent would only raise $20 million to $30 million every year. House Republicans said they would rather remove $50 million in tax credits from the oil and gas industry.

Democrats and some Republicans, including state auditor Gary Jones who is also running for governor, believe raising the gross production tax to 5% would generate $300 million each year.

The House has just five days starting to pass revenue raising bills and another week to approve a state budget or the state legislature will be forced into a special session.

Inman said the Democratic caucus will not support any revenue measures that are not paired with an increase in the gross production tax.

Without additional revenue, the house would be limited on what budget measures it could pass. The House could approve major cuts to state agencies, however the governor has threatened to veto any budget that does not include increases to revenue.

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