The list shows that only West Virginia has fewer people than Oklahoma and more than one school offering either MD or DO degrees.  Meanwhile, seven states (Oregon, Colorado, Minnesota, Wisconsin, Maryland, Massachusetts and Washington) with higher populations have just one medical school.  Arizona has just one university with a medical school, but two campuses and Indiana has nine campuses where students can go for the first two years of medical school, but just one campus offers the final two years.

State Representative Doug Cox (R-Grove) is one of two licensed physicians in the House of Representatives.  He says it makes sense to have the two centers. “The Oklahoma City campus is pretty much at full capacity,” says Cox.  ”In addition, you only have so many faculty and so many patients to work on.”  He says states like Washington, Colorado and Maryland that have larger populations can get by with one medical school in part because there are larger cities to work in. (see below for the entire interview with Cox)

But Cox believes there are ways to save money and he has even suggested them to university officials, but so far they have not been implemented.  He says whether you’re pursuing an MD or a DO degree, the first two years of course work are nearly identical and could be consolidated while offering osteopathic muscle manipulation as an elective for DO students.  For the current fiscal year, the budget for the OU Health Sciences Center is about $791-million while OSU’s Center for Health Science has a budget of just under $150-million.  Cox says there are rivalries at the legislature that sometimes get in the way of reforms, whether they are urban v. rural, Tulsa v. Oklahoma City, OU v. OSU or even MD’s v. DO’s.

Cox has no doubt that with many doctors approaching retirement age, now is the time to “have vision and look down the road” to address the doctor shortage in the state.

House Conference Committee on Judiciary, Public Safety and Military

CCR to SB447 by Armes
Armes: there was a part in the bill where a gun inventory would be done if a suspect was violent. That was removed. I think it’s a fair compromise and strengthens protective orders.

Morrissette: it says the court can consider the safety of any and all alleged victims. That will expand the scope of these hearings. They’re pretty much a free-for-all now.

CCR is signed out of cmte by six members

CCR to HB2535 by McCullough
McCullough: extends rule against perpetuities.

Morrissette: I feel we’re voting on something we don’t know anything about. How does this help the folks of Oklahoma? McCullough: constitution requires us to have a rule against perpetuities. This protects the interests of family farmers and small businesses. Allows you to transfer accumulated wealth without having to sever those interests. It protects our farmers and businesses from federal estate tax and provides income for the state off of these trusts. Morrissette: it’s insulating these trusts from federal estate taxes, right? McCullough: yes, that is the intent of the bill.

CCR is signed by 8 members.

CCR to SB1055 by Enns

Sherrer: there’s language that says successful treatment for PTSD will not be included as treatment of mental illness. Is that subjective? Enns: there is a standard out there. It would be the purview of the physician. Sherrer: doesn’t striking the language that someone adjudicated as incompetent is precluded from getting a concealed carry permit mean someone who is incompetent can get one? Enns: the OSBI and DA’s office all agree this is the language we should have. Sherrer: is PTSD something that someone, particularly a veteran, gets treated for and cured or is it something they carry with them the rest of their life? Enns: anyone can have PTSD. It’s the body’s reaction to a stressful situation. It could be someone who was in a tornado or someone who was raped.

Wesselhoft: why make a special provision for PTSD for veterans and not others? Enns: the idea is to help veterans, but it does not preclude other sufferers.

Sherrer: is it possible to be successfully treated for PTSD and not be stable? Enns: no, once you’re treated, you’re stable.

CCR is signed out of cmte by 6 members.

CCR to SB1067 by Roan
Roan: the Senate restored the bill to its original state and added the language allowing tag agents to give the written test.

Morrissette: there is new language on fees. Roan: that’s the language from HB2367 that we already passed. Morrissette: it says a police officer has probable cause to detain someone on their own property for almost any reason? Roan: this has to do with towing, not detaining a person.

Jordan: if I read this correctly, you have a vehicle in your driveway and a police officer thinks you don’t have insurance he can tow it? Roan: if there’s a complaint that a vehicle is blocking a driveway and there’s probable cause then it can be towed. They can’t tow from private property right now. Jordan: I understand the spirit, but that’s not how it’s drafted.

Roan lays the bill over.

CCR to SB1887 by Jordan
Jordan: I think this is the solution to the military divorce retainer pay situation. Provides a calculation on the amount a spouse can get in a divorce based on the length of the marriage and the rank and pay of the military member at the time of the divorce.

Wesselhoft: was there any consultation with Rep. Banz on this? Jordan: yes, Sen. Russell worked with Rep. Banz on this.

McCullough: there are some veterans who think that in no event should this retainer pay be part of the property that is divided. We allow the court to make that distinction. What would happen if we left it as sole property of the soldier? Would that run afoul of federal statute or current divorce law? Jordan: under federal law, they are already dividing that, but in a way some consider unfair. This provides the court a standard to split it in the fairest way possible.

Wesselhoft: do other states use this same formula? Jordan: I don’t know the answer to that. Phil Tucker, Edmond attorney: the formula is used in other states. It’s called the Marital Fraction. It’s not identical language, but it is language the federal government will recognize.

CCR is signed by 9 members.

House Floor session

HJR1113 by Nelson
Nelson: approves rules of DHS allowing them to recoup cost of collecting child support.

Morrissette: we’re adding fees to those who owe child support, isn’t that what’s going on? Nelson: allows DHS to recoup costs. Morrissette: that’s one way of looking at it. Another way is we’re taking money from those paying child support. Nelson: another way is we’re currently taking the cost from taxpayers that don’t pay child support. I think the people that owe the money ought to pay. Morrissette: parents that owe the money do their best to pay and to tack on another fee is unfair. Nelson: I don’t think it’s unfair it’s a cost taxpayers are paying now.

Williams: is the $25 tacked on to the person paying or the person receiving? Nelson: it is taken out in addition to the payment to the custodial parent where allowed by federal law.

Morrissette: How much money is this going to raise? Nelson: this is only on delinquent cases. I don’t have a figure on that. Morrissette: so this is a way where the federal government is helping the state? Nelson: and there are a lot of ways that is not the case.

Reynolds: this is a fee for service, who is getting the benefit? Nelson: the child, ultimately. Reynolds: but the person paying the fee is not getting a benefit. Nelson: I don’t think I follow you. Reynolds: what does the fee cover? Nelson: transmitting of documents and other costs.

Resolution fails 47-46.

House General Conference Committee on Appropriations

CCR to HB1979 by Pittman
Pittman: held over from last year. Creates Oklahoma Freedom Trail. Now has no fiscal impact.

Cox: in my district I have a park with bathrooms locked up, empty swimming pools and unfilled maintenance positions. So I’m concerned about no fiscal impact. Pittman: it’s starting with just a website. They will put QR Codes on signs so people can get more information via their cell phones. Cox: I want to hear there’s no impact to the Tourism Dept. budget. Leslie Blair, Dept. of Tourism: we had some issues with this bill in the beginning. We have a solution we think is workable. Will be part of our regular web development.

Billy: what changes were made in the Senate? Pittman: we’ve removed the amendment that added Parks and Recreation to put it back in its original form.

Peters: if everyone is willing to do this, why do we need the statute? Pittman: we thought it was better to have it in statute so that as people retire from agencies, it will continue.

CCR is signed by 13 members.

CCR to HB2510 by Coody
Coody: says a person cannot use an organization’s tax exempt status for personal use.

CCR is signed by 13 members.

CCR to HB2523 by Steve Martin
Martin: combining two wildlife request bills that both passed out of the House easily.

CCR is signed out by 13 members.

CCR to HB2659 by Jordan
Jordan: changes interest penalty calculation on uniform building code from 1% per day to 1% per month.

CCR is signed by 13 members.

CCR to HB2242 by Denney
Denney: simply restores title

CCR is signed by 13 members.

CCR to HB2273 by Cox
Cox: this is the same bill that failed last week. We took out the part that the pharmaceutical industry opposed.

Dorman: is part of the problem that pharmaceutical reps try to get doctors to prescribe their drugs which may be more expensive, but not better? Cox: that’s a problem with the industry in general.

Sears: this has a savings to the state? Cox: probably has no fiscal impact. Might give more control by reducing from 120 days to 30 days.

McPeak: if the doctors would conscientiously base prescriptions on what was most effective, there wouldn’t be a need for this? Cox: that’s true for more than just Medicaid doctors. McPeak: this will not eliminate the doctor from prescribing what he thinks it is best, but might prevent Medicaid paying for it? Cox: the doctor can call Medicaid and get approval in 24-hours. It’s been that way for more than a decade.

CCR is signed by 13 members.

Conference Committee on Education

CCR to HB2676 by Shumate
Shumate: gives another tool to Dept of Education to help youngsters read. This empowers communities and faith based organizations to help children improve their reading.

Coody: what is the fiscal impact? Shumate: there is none. There’s no mandate, they’d use existing funds. We’ll work on the funding part at a later date.

Cannaday: the Dept. of Education will do the training? Shumate: yes, according to what is in the curriculum. We didn’t want the organizations to have their own, inconsistent programs.

Jeannie McDaniel: would you say this is program development as opposed to teacher development? Shumate: yes, because this would be assistance. McDaniel: so would this be schools that apply or district? Shumate: by district.

Casey: is the state dept behind this? Shumate: yes, they worked with me on this.

Holland: if this was funded, wha kind of dollar amount would be needed? Shumate: there are so many intangibles I don’t want to quote a figure. We’re not paying for anybody or the program, so it would be minimal. Holland: does this put us in a position of ‘why did you fund it one year and not the next?” Shumate: no, there is no mandate so it’s not to be construed in that way at all. Holland: our church is active in this way already, so how is this different? Shumate: we wanted something more formalized so if organizations wanted to fund something they could.

Nollan: would the organizations give the money to SDE or is it grants or state money? Shumate: the groups work with SDE on the funding. Nollan: do you envision a foundation giving money to a church that then applies to SDE? Shumate: no, we wouldn’t want the organizations going through the church. The State Board would promulgate rules.

Cannaday: why does it require organizations to be tax exempt? Shumate: the goal was to make it for non-profits only.

Kouplen: is there anything now that prevents a local group from starting a program and getting funding? Or is this just a way of getting the money to SDE to form a grant pool? Shumate: the intent is that the organizations are closely aligned with SDE and what teachers are doing currently.

Coody: so this does not preclude existing programs? Shumate: absolutely not, this is an additional tool in the toolbox.

Kouplen: but what prevents them from doing this now? Shumate: we wanted to make sure we don’t have volunteers working independently. We want it in line with the curriculum. Our intent is to have something formalized and more in line with the department. I think it’s kind of a new concept in that it would be volunteers.

Coody: will the difference be the training and assistance provided by SDE? Shumate: absolutely.

McDaniel: I’m a mentor at a school. So you’re saying if a foundation wants to give money to SDE then the volunteers get trained and that’s what you’re trying to do? Shumate: very much so.

Nollan: say we have districts that have a program already, do they have to get that approved by SDE? Shumate: no.

Denney: do you have numbers on how much SDE will charge to do this? Shumate: I don’t. A lot would depend on the size of the program. Denney: what is the scope of the training? Is it one Saturday morning or six? Shumate: it depends on what areas are covered. But the question shows the need for why we need this to be formalized.

Casey: can’t we do this without another program? Joel Robison: Part of the issue is we’re trying to reach out to volunteer sources in communities to bring them into the school system. Anytime you can do that it’s a positive thing.

CCR is signed by only 4 members, so it does not make it out of committee.

CCR to HB2700 by Fourkiller
Fourkiller: allow a school to stock epi-pens for use on students or staff.

Denney: can you talk about training? Fourkiller: State Department of Health does diabetes training they can also get the training from a pharmacist who trains anyone else who gets one. Denney: so in a school with 50-teachers, how many get trained? Fourkiller: it will be up to the schools. Denney: what do you anticipate is the charge? Fourkiller: a two-pack of epi-pens is $215.

Holland: this is totally “may” language? Fourkiller: that is correct.

Casey: I like the intent of the bill. What concerns me is the liability aspect. Fourkiller: there are always concerns. But it’s a safety issue for me, like the defibrillators we have at schools.

Ryan Owens, CCOSA: we have concerns about liability. If a student passes away because of a known heart condition, there are liability issues. In another district that decides not to have the epi-pens, a student dies of anaphylactic shock and the parents can sue because the pens could have been stored. So either way there are issues. I know of only one case in the country – in Virginia – where a student died of anaphylactic shock.

Jeannie McDaniel: just a few years ago, students were allowed to carry them. Did we not require parents to inform administrators? Steven Crawford, CCOSA: if they know they need the pen, they absolutely should be allowed to have them. I don’t think there’s any problem with existing law.

Cannaday: aren’t districts covered in the bill’s language? Owens: it still comes down to proving negligence. It’s hard to write a law preventing lawsuits.

Kouplen: there are children who know they have the problem wouldn’t it be better that they notify the administration? What are the symptoms? Fourkiller: throat swelling, trouble breathing.

McDaniel: so what you’re proposing is that schools keep these in their medicine cabinets? Fourkiller: that is correct.

CCR is signed by seven members which means the CCR is approved.

Ortega: while the bill I have is important, we’re going to add language that will deal with National Board Certified teachers and as soon as that is available I’ll get it out to you

House Administrative Rules and Government Oversight Committee

SJR91 by Virgin
Virgin: there is a fee increase so DEQ monitors and makes sure those reusing water are doing it right to protect the people.

Brumbaugh: with this program recovering wastewater and making it useable, wouldn’t you agree that’s the right way to go? DEQ Director: I absolutely agree.

Resolution passes unanimously.

HJR1131 by McNiel
McNiel: currently a $10 fee to get your GED. This reduces that to a $4 fee

Resolution passes unanimously.

HJR1132 by Banz
Banz: Construction Industries Board permanent rules.

Resolution passes unanimously.

House Floor session

CCR to HB3049 by Sanders
Sanders: this body passed this in March 91-4. Conference committee just restored title.

Shelton: can you explain the bill? Sanders: any sex offender that preys on children, once they’ve completed their term, they cannot live in the same house as a child unless they are the parent or grandparent.

Virgin: is there anything in the language specifying tier three offender whose victim was a child? Sanders: it’s up to the court to make the final determination. Virgin: but aren’t there Tier 3 offenders who have not victimized children? Sanders: those are a very few cases.

Cox: is this even after they are on parole? Sanders: you are not on the sex offender roll until you are out of prison.

Morrissette: this is written so that it applies to all levels of sex offenders, does it not? Sanders: the requirement is that the victim is a child, so that does not include Tier 1.

Jeannie McDaniel: I have people in my district because they had sex with their wife who was underage at the time. Does this affect them? Sanders: this is not retroactive. Plus as long as they didn’t perpetrate the crime against a child, it wouldn’t apply. McDaniel: is this a request bill and is it a requirement of the Adam Walsh Act? Sanders: it is not, but I’ve had conversations with the group.

CCR is adopted by voice vote.

Debate
Sherrer: I concede these are sticky issues and this makes for a slick election mailer. Who could be opposed to this? But it gets over-inclusive because it includes scenarios where contact was consensual, but because of the age of the victim, it’s a crime. Because of that there is a big problem. Step up and take a tough vote to shut this down. There’s a way to fix this.

Sanders: I appreciate the comments, but disagree this is overreaching. When you have minors who are victims of assault, victims of sexual abuse by these predators, something must be done. To answer the question of an 18-year-old with a 16-year-old girlfriend, this law doesn’t apply. This is absolute common sense. Why put these predators back in the homes where children live?

Bill passes 75-9

SAs to HB3055 by Steele

Wesselhoft: I’ve seen the language many times “contingent on availability of funding.” What does that mean? Steele: This program is already in existence, funded at $50K per year. This just adds rural water districts to those that can apply. This says if there’s no funding, no grants are given.

Peterson: it says the goal is to consume no more water in 2060 than we do in 2012. How do we do that without rationing? Steele: it says using existing supplies more efficiently and using brackish and non-potable water to make them drinkable. Peterson: in 2005 there was a meeting of mayors in San Francisco that says we need to limit to 26-gallons per person. Does this do that? Steele: I don’t know anything about that. This just says to use our resources as wisely as possible.

Renegar: isn’t this one of the eight recommendations of the water plan? Steele: it is. Renegar: isn’t this something San Antonio has been doing for years? Steele: yes, we’re just saying to use strategies we haven’t been using to conserve water.

Reynolds: is this related to the committee Gov. Fallin appointed? What’s the difference? Steele: we established a cmte headed by Rep. Richardson. This bill develops strategies so future legislators can develop a future water plan. What the Governor is doing is in response to a federal lawsuit.

SAs adopted by unanimous consent.

Bill passes 65-23.

HB3148 by Steele
Steele: this is required every ten years. This says the laws we have passed are the law of the land so that the statute books can be printed.

Morrissette: if you look at the repealer, there’s nothing in the bill that will reauthorize the printing of hard copies. Steele: last time we did this, the contract was part of the statute. So rather than be locked in to a contract by statute, we went this way to competitively bid this. In the age of technology, there are agencies that would rather have an electronic format. So this provides that flexibility. Morrissette: why isn’t there language that says we are going to print them in the next cycle? Steele: they are only printed every ten years. We have supplements every year, but this provides more flexibility. It costs $1.5-million to print out all the statutes for all agencies and some never use them.

Debate
Morrissette: I think we’re arguing apples and oranges. This bill went directly to the calendar. We’ve never seen this before. If we didn’t want to print them, why not amend the language rather than repealing it? I understand the point of saving money, but there’s nothing here saying that those that want hard copies will get one. What about local libraries or schools? Reject this version of the bill and rewrite it. Reynolds: this bill doesn’t conform to any deadlines in our rules, right? Morrissette: yes. Reynolds: so the Speaker and pro tem can do anything they want regardless of rules? Morrissette: it appears so. Steele: would you agree the repealer simply eliminates the sole contract with one company for printing? Morrissette: I do not! If you wanted to change that part you could have simply amended it. Reynolds: would you agree that if we could find a way to save a million dollars with this at such a late date, we could find a way to get a bill to eliminate tax credits and incentives that would save hundreds of millions? Morrissette: I agree.

Steele: this is a formality. It’s required to be run every ten years. What we discovered was the law was written to give one company the right to print the statutes. We say we’re for using taxpayer money efficiently, so we cleaned it up to make sure a competitive bid process can be used.

Bill passes 85-7

HJR1114 by Banz
Banz: rule change request from Real Estate Commission.

Resolution passes unanimously.

Senate Amendments to HB2388 by Liebmann
Liebmann: requires that TANF benefits can’t be accepted by people using illegal drugs. Doesn’t hurt children. Screening done at application.

Jeannie McDaniel: thank you, this is an entirely new bill. If someone tests positive the money you would have received goes towards treatment? Liebmann: correct.

SA adopted by voice vote.

Bill passes 86-6

Reject SA to HB2921 by Richardson

SA rejected by unanimous consent. Bill sent back to conference committee.

Note: it is a tradition in the House and Senate that a lawmaker who is in his or her last year in office due to term limits takes a point of personal privilege and addresses the House from the well.

Rep. Paul Roan (D-Tishomingo) addresses the House: I never thought I’d be standing here 12 years ago. When I came here I thought I might stay two or three terms, but here I am. First thing I’m going to do is introduce my wife. I would not be where I am today without her. She’s my wife, best friend and cheerleader.

When each of us come to the Capitol, we think we’re right on everything and everyone should agree with us. That was my first lesson here. I challenge each of you to remember the people we represent. Look at the legislation and ask yourself “how does this affect my constituents, how does it affect the state?” only then look at who the author is. Build relationships across the aisle regardless of political affiliation.

If you look at these [legislative] pages who do a great job, the seniors [in high school] were in Kindergarten when I got here. 12 years passes in an awful hurry. Rep. Purcy Walker, Ray Miller and I became known as the three amigos. We lived together the first six years we were here. Miller had his microphone taken away twice and he thought he’d be better pursuing other options.

All of us carry legislation I thought I’d mention the two of mine I thought were best. The first meth bill I was the first co-author. For an old country boy and trooped in Tishomingo, it was scary when that bill was heard and there were five TV cameras in committee. It became model legislation for meth in 37-states. And SB288. When I signed on as House author, only thing I knew about water was H2O. Now I have four boxes of files in my office.

I’d be remiss if I didn’t mention a few individuals. Speaker Steele is the first. We came in together and, he IS the Speaker. Us three amigos were so convinced we could change him to Democrat we went to his weekly prayer meetings for two months. Then we realized we couldn’t do that and we stopped. Thank you for being one of the fairest Speakers ever. Next is Ron Peters. In 12 years I don’t think I ever voted against a Ron Peters bill. He had a problem down in my district with speed. I was able to help him with it and he voted with me on my infamous speed trap legislation. I want to mention my predecessor Tommy Thomas. You’ve been a friend and mentor. You’ll always be my Rep.

I want to close with a piece of advice my dad gave me. Rural lawmakers will know what I’m talking about. He said son, when you leave, make sure the log pile is stacked a little bit higher than when you got there.

This is the hardest part. Sue [pointing at the empty desk of Rep. Sue Tibbs who passed away last month], you never pointed your finger at me, but I’m pointing mine at you now. One of these days we will see each other again. See you later, Trooper Tibbs.

CCR to HB1361 by Peters
Peters: simply restores title.

CCR is signed by 7 members

CCR to HB2367 by Billy
Billy: increases efficiency at DPS. We’ve had to close examination sites. This allows a driver’s school to do testing for student rather than requiring them to go to DPS station.

CCR is signed by 7 members

CCR to HB2959 by Billy
Billy: allows tribal police to investigate state crimes on tribal land. We have people creating meth labs on tribal land because they know tribal police can’t investigate. There are some counties that have cross-deputization, but not all do.

Jordan: so if a tribal officer arrests someone for a state offense do they hand it over to the DA? Billy: they have no authority to do that now. But once this passes, my understanding is yes.

CCR is signed by 7 members.

CCR to HB2522 by Steve Martin
Martin: restoring it back to the version that passed in the House, removing bad Senate amendments.

CCR is signed out by 6 members. Roan does not sign.

CCR to HB2254 by Sherrer
Sherrer: there is some new language in the bill. One is from Rep. Scott allowing for behavioral health dispatch system, follow-ups to justice reinvestment act that changes a ‘shall’ to a ‘may’ when it comes to substance abuse and mental health assessment.

CCR is signed out by 7 members.

CCR to HB2396 by Rousselot
Rousselot: we took six qualifiers for lifetime protective orders, got rid of one and consolidated two into one so there are now four.

CCR is signed by 7 members.

Note: due to the length of the Tax Policy Forum, I missed the first 15-minutes of the session and came in just as the vote started on the first bill below.

SA to HB1952 by McNiel

Bill passes 78-3 (Bennett, Reynolds, Ritze opposed)

HR1057 by Steele
Steele: the first week of May is public service recognition week. Since I believe we have the best staff working for the OK House, I think it’s appropriate to recognize them. We have 180 employees in the House. Our staff are the greatest and I’d put them up against any in the nation.

Resolution adopted by unanimous consent.

HJR1124 by Thomsen
Thomsen: approves CLEET rules.

Shelton: is there a fee increase with this? Thomsen: no.

Resolution passes 90-1 (Shelton opposed)

CCR to HB2230 by Faught
Faught: deals with natural gas marketing board. Restores title removed in Senate. Extends board through 2015.

CCR adopted by unanimous consent.

Bill passes 89-3 (Bennett, Murphey, Ritze opposed)

State Chamber President Fred Morgan: why are we having the event? Chamber wants to have dialogue on taxes. We want these two men to discuss their views.

State Treasurer Ken Miller (moderator of the discussion): purpose is to investigate best practices for tax policy. My intent is not to be ideological. This is not Obama v. Reagan.

Many would agree if we would design a tax code, we wouldn’t have what we have today.

Opening statements

UCO College of Business Dean Mickey Hepner: this is something that has generated controversy, comment and discussion. The proposal to eliminate the income tax generates concerns for me. I don’t think it will generate the payoff supporters claim. There will be ripple effects that shift the burden away from the wealthy to those that can least afford it. I don’t like the economic model used in the Laffer plan. I would argue that the independent variables in the market are not truly independent. It tries to estimate the relationship between cutting taxes and economic growth. But it turns out the relationship doesn’t work this way. What we saw in the 80’s was that the decline in incomes led to an increase in taxes. Early in the 2000s we saw that lawmakers responded to growth by cutting taxes. This model inflates the effect of the tax cut. It’s not reliable. I don’t know of a single state economist who has supported this plan. If we look at the data, we see the state’s economy is doing well, better than most states without an income tax. We are thumping Texas. We don’t have to be more like them, they should try to be more like us. One of three things must happen if we eliminate the income tax: we have to increase property tax, increase sales tax or cut spending. It seems unlikely we will increase the property tax. We are already a high sales tax state. Relying more on a sales tax puts more of a burden on families. We could cut spending but that concerns me. What worries me is training a workforce. Education, health care, roads, prisons have a positive impact on the quality of life. We can not, should not tolerate a reduction in that quality of life. If we want to attract high quality companies we have to make this a desirable place to be. My fear as an Oklahoman, economist, educator and father is this plan doesn’t generate benefits stated and has repercussions we can’t see. When it comes to growing the economy it’s not lowering taxes, it’s improving the quality of life.

Economist Arthur Laffer: I’ve been working with states since Prop-13 [a California property tax limitation initiative passed by voters in 1978]. Governments can’t be agnostic like economists. They have to make a decision. If you have two locations and raise taxes in one and lowering them in another businesses go to the one with lower taxes. You have done a wonderful job in OK. Government spending IS taxation. If it’s good economics it works just as well in a two-person world as it does in a state. If you have Farmer A and Farmer B and Farmer B gets unemployment, who pays? Farmer A. You want to have taxes to the point where an extra dollar in taxes no longer means another dollar in spending. How you collect your taxes matter as much as the amount collected. You want to collect in the least-damaging fashion. How you spend your money also matters. If you look at the repository of information from states and federal government, clearly not everything works the same in each. Not everyone who smokes gets cancer and not everyone who doesn’t smoke doesn’t get cancer, but certainly smoking increases your chances. States with no income tax really outperform other states and far outperform the states with the highest income taxes. Those states that adopted an income tax in the last 50-years, their share of the US economy has declined, some of them by a lot. California, it’s just like clockwork. When Prop13 came, the economy boomed and when taxes were raised it tanked. From my research standpoint I can tell you this stuff is really there, it works and its correct. The best form of welfare is still a high paying job and you’re not going to attract those jobs with high taxes on employers.

Miller: How would you structure revenue sources best? Hepner: most important thing is raising the most money with the least cost. Two of our taxes, income and property are deductible on federal returns. So if you raise sales taxes, there is no change in federal liability. We can have our cake and eat it too by relying more on deductible taxes. So we should rely more on income and property tax and reduce sales tax. Laffer: the way the Laffer plan does it is good. Reducing over ten years is good because you can see when things go wrong. Taxes don’t redistribute income, they redistribute people. The deductibility argument leads to higher taxes in NY and CA. If you want growth you have to make it attractive for people to be here. It’s a plus to focus on education, but don’t think all those people are staying here. That’s not a growth model.

Miller: so do you prefer a national sales tax instead of an income tax? Laffer: absolutely. I think there should be two flat-rate taxes for individuals and corporations and that’s it. Hepner: I would not prefer that. I think you can make the federal income tax easier and less complex, but with a national sales tax there are problems of collection and equity. It shifts the burden to the poor.

Miller: according to Rich States, Poor States, NY outperformed two states w/o income tax. Utah – which has an income tax – outperformed all other states. What are the factors other than income tax that contribute to that? Laffer: NY, UT and OK have been lowering taxes which matters a lot. Right to Work also matters. Hepner: of the 9 states w/o an income tax only four are in the top half of income per capita. The worst performing state in per capita income over the last decade is one without an income tax. It’s more than just taxes, it’s quality of life.

Laffer: people deserve the governments they get. I don’t know if this will happen, but I hope it does. I think you should reduce credits and exemptions and have a flatter rate. The income tax protects the wealthy and prevents the poor from becoming the wealthy. Hepner: the evidence actually show that the effects of the tax rate are biased so we wouldn’t see the growth effects. If you’re not going to get that revenue then we have to raise other taxes or cut spending.

Miller: it’s been argued a tax cut will pay for itself by spurring consumption. How much would spending have to increase to offset that and what would the population have to be? Laffer: not all the revenue is made up by any means. This wouldn’t stop growth, it would certainly mean it wouldn’t grow as fast. Hepner: best case scenario I spend all of my $100 in income tax savings on taxable goods, so the state gets $4.50. So I would need to spend $2200 to make up for that income tax cut. But the truth is not all things are taxable, it’s more like 70% of what we spend on. Laffer: taxes change behavior.

Miller: it seems the discussion is now the size of an income tax cut and whether there should be triggers for future tax cuts. Which do you prefer? Hepner: Pay as you go. If you think we spend too much, make your case. I don’t like the idea of instituting tax cuts in the future and triggers. Make the case each time to voters. That’s why we have the elections. The conditions in 10 years might be vastly different. Laffer: I think triggers are a reasonable thing.

Audience questions
Miller: what are your thoughts that personal income taxes are necessary for wealth distribution? Laffer: there are two types of incentives. If you beat a dog, you know where he won’t be. If you feed him, you know where he will be. When you want to rectify distribution of income be up front and write a check.

Miller: in 2005 income taxes were lowered and revenues increased which were spent on more government. How does that sit with arguments here? Hepner: the income tax cuts came around because of a growing economy. That was a time when the US economy was expanding. OK grew because the nation was growing again, not because we cut taxes.

Hepner: evidence does not show that tax cuts stimulate revenue growth. The record is mixed. I believe strongly that if you cut taxes we’re either going to have to cut spending or raise taxes somewhere else. Do we want to cut education health care prisons or roads or do we want to raise sales or property taxes? Laffer: there are some taxes that are worse than others. I think you’re better off with a sales tax and no income tax. I think you can afford to eliminate the income tax over ten years. Once it’s gone, there are no expenses of tax returns and the time to fill them out.

Closing statements

Laffer: You know where I stand on the issue. Thank you for inviting me.

Hepner: to me this is a simple thing: what’s best for OK and our future. It’s clear eliminating the income tax is not a step forward. It’s not taxes that drive economic development. OKC is dynamic and interesting and cool. And the effort that led to us having the Thunder came about not because we lowered taxes but because we raised them.

HJR1128 by Morgan
Morgan: rules for Funeral Board do include fee increases. This is not an appropriated agency.

Peterson: will this be passed to the clients? Morgan: I can’t say what the companies will do. But we’re talking about $250 in one instance and $175 in another. If it would be passed down, it would be very small to any individual customer.

Brumbaugh: on salary expenses, the additional money is $60K. What is that for? Mark Riley: benefits and taxes for employees.

Faught: why has the agency increased personnel costs? Riley: one employee had to leave for medical reasons and that post was not filled until 2010.

Jay Baines, OK Funeral Director’s Assn.: we realize it’s been awhile since fees were increased, but we’re concerned about the sudden need for the money.

Riley: when I was made director I looked at the budget and saw we were on an unsustainable path. We need to hire additional staff to continue the mission.

Brumbaugh: what is the association’s opinion on the doubling of the fees? Baines: there are concerns. I’ve been attending Funeral Board meetings since the 80’s and there was never a budget issue until now.

Jim Parks, Funeral Board director: one issue is a mandate to upgrade our computer system so we can accept online payments. Our cost for that will be $80K. There’s also a question of our rental costs on Lincoln Boulevard. We’re facing what I call major expenses. There is no fat in the budget. We have two full-time staff and one part time. The rest is mandates. We don’t control taxes or benefits. We have 437 establishments and 1,200 licenses. Only 60 of those would pay higher fees.

Brumbaugh: why is the number impacted by higher fees is so low? Parks: there are just a handful that are not dual-licensed as embalmer and funeral director.

McCullough: can you give a breakdown on who makes how much in salary and break down other expenses? Riley: My salary is $63,500 my assistant is $70,000. We have a part-time staffer at 700-900 per month. Our non-salary expenses are rent, telephone, internet. McCullough: where are your offices? Riley: Lincoln Plaza because the rates are low, but we realize we may have to move from there. McCullough: why the doubling of the fees? Riley: the fees haven’t gone up in 2003. As a result of looking at our budget and determining what we had to do under statute, we came up with those fees. It is still lower than surrounding states.

McCullough: in one year you have a 90-95K hole in your budget. How on earth did we get such a jump in operating costs? Riley: in 2008 there was a drop in salary as the agency head had health matters that caused him to step down. That position was not filled until late 2010.

Banz: when the books close of FY2012 will you show a deficit? Riley: yes, but it will be in the 5-15K range. Banz: when you have deficits, how do you balance that? Riley: we have a cash fund that traditionally has about one year of expenses in it.

McCullough: we’re looking at 100% increases on fees and licenses. Current your income from that is $334K. How will this not double that to $700K? Parks: the fees that are doubling are for the 470 establishments. The licensees, there are only about 50 that will see a fee increase. If you are dual-licensed, there is no increase. If you have only a embalming or funeral director license, your fee will double.

HJR1128 fails 2-6

CCR to HB2684 by Banz
Banz: restores title. The bill allows flex benefit allowance to be calculated by hours in addition to days.

CCR is “signed” by 13 members.

CCR to HB2576 by Ownbey
Ownbey: simply restores title. The bill brings due dates for reports to the same date to make it easier on business owners. No longer requires monthly withholding reports – moves to quarterly. Prohibits use of “zapper” to bypass sales tax reporting.

McPeak: do these have to be filed electronically? We’ve had small businesses go out of business because of that. Ownbey: this doesn’t change how you file it, just when.

CCR is “signed” by 13 members.

CCR to HB2616 by Johnson
Johnson: restores title and enacting clause. Doctors don’t get reimbursed for sales tax they pay on an item they use on a Medicare patient. This allows them to buy the equipment without sales tax and then if it is used on a non-Medicaid patient, the doctor submits the tax.

CCR is signed by 11 members.

CCR to HB2469 by Morrissette
Morrissette: restores title. This is the infrastructure bank required to get federal funds.

CCR is signed by 13 members.

CCR to HB3093 by Williams
Williams: restores title, changes the effective date

Brown: this in no way deals with commercial float trip operators? Williams: correct, the Illinois River has a separate permit tracking system.

CCR is signed by 12 members.

CCR to HB2390 by Liebmann
Liebmann: puts the title back on. This is the $5K deductible that ODOT would like to not have to pay when acquiring road right of way access.

McPeak: deductible for what? Mike Patterson: when ODOT acquires right of way, we sometimes find underground storage tanks. We have a $5K deductible we pay with the rest coming from the storage tank indemnity fund. This would say we don’t pay that.

Brown: is the $5K used for mitigation or removal? Liebmann: both.

CCR is signed by 13 members.

CCR to HB2391 by Liebmann
Liebmann: increases weigh station fund from $51M to $81M so we can build 11 of them.

CCR is signed by 13-members.

CCR to HB2273 by Cox
Cox: only language taken out was that which might have prevented a pharmacy from using the lowest-priced alternative.

Armes: if the drug is needed, it can be authorized in 24-hours? Cox: a maximum of 24-hours.

McPeak: does this not require them to go with the cheapest option? Cox: it requires the most effective. McPeak: why would you want to take the ability away from the doctor to prescribe the best thing? Cox: let me give you an example. There are five drugs out there for Hepatitis C. this gives HCA ability to say “we’re not going to pay for it until we know it’s going to work.” That change alone would save $8M.

Brown: a lot of these drugs have to be tested on the patient to see if the patient responds. What is the time frame we’re looking at for the prior authorization? Cox: you can tell from a blood test what type of Hepatitis C you’re dealing with. Not all drugs are on prior authorization. This gives HCA same ability to manage pharmacy benefits that HealthChoice has.

Hoskin: the fiscal impact is a savings of $2.8-million? Cox: that’s based on the Hepatitis C medication alone. It’s approximately $13K per treatment course and it’s being incorrectly prescribed about 75% of the time. The only people who have a problem with this is the pharmaceutical industry.

Scott Martin: I understand the pharmaceutical industry approached HCA with an alternative. Why is that not in here? Cox: that had the possibility of preventing a pharmacy from using the least-expensive generic. Martin: any worry that in the zeal to save money we’re going to hurt people? Cox: I’m not in this business to hurt people. I’m not the least bit concerned this will interfere with a doctor’s ability to make people better.

Brown: what concerns me is that it could be 120 or more days before a drug can be administered. Cox: no, a doctor can give the drug and then get authorization within 24-hours.

Cox: when we get calls from people because we cut adult dental care, don’t come to me because we held out to big pharma.

CCR is signed by only 8 members. Nine required to send it out.

“There’s going to be individual members who will vote for the Native American Center and Pops,” said Sears, “but to win it on the board, you got to have a majority and I just don’t know it’s there.”  Sears says members know about the dire need for a new building for veterans and expects that will pass if brought up.

Negotiators from both houses and the Governor’s office still have to work out how large the bond proposal for the Capitol will be.  Sears says the House position would be around $160-million for the Capitol building alone while the Senate wants a larger $200-million plan that would include more buildings in the Capitol complex such as the Jim Thorpe Building.  Senate Democrats say they will not support any bond proposals if the budget also includes income tax cuts.

As for a timeline, Sears expects everything to be finalized soon. “I plan on staying here for the entire week. My goal is to have an income tax and budget worked out by Friday of this week,” he said.  But that doesn’t mean there will be a press conference announcing it by then.  Sears says lawmakers would have all weekend to look at the deal and any tweaking that is necessary would be done next Monday.