GOP Empties Out State’s ‘Rainy Day’ Fund, Plans to Incur More Debt to Balance Budget
By State Rep. David Perryman
OKLAHOMA CITY (5 April 2017) — Reeling from severe losses inflicted at Pearl Harbor and a series of Japanese military victories in early 1942, the United States Navy during World War II used a strategy of calculated deception to make up for being outnumbered by Japanese vessels across the Pacific. Intrinsic in that strategy was an attempt to confuse the enemy about the number of battle-ready ships that America really had.
The plan was successful, and if the Battle of the Coral Sea in May 1942 provided the first hint that the superiority of the Japanese naval forces was beginning to crack, the Battle of Midway a month later made that fact apparent to all.
Loosely based on that strategy and those two battles was the 1944 movie, “A Wing and a Prayer,” which chronicled the dangers, mishaps and heroism of the crew and the naval pilots serving aboard a U.S. aircraft carrier in the desperate early days of World War II in the Pacific theater.
Today “a wing and a prayer” is a phrase used to describe a difficult situation, relying on meager resources and luck to get out of it. Sort of like the current Oklahoma current budget crisis.
Because of the foresight of our Oklahoma forefathers, we have as a safety net a Constitutional Reserve Fund commonly referred to as our “Rainy Day Fund.” The fund was created to be a lockbox as described in Article X, Section 23, of the Oklahoma Constitution, the same section that mandates that Oklahoma government must never spend more money than it has. In addition to the balanced budget requirements, Section 23 requires that in any year of excess revenues, before anything else is done with the surplus there shall be a deposit into the Rainy Day Fund so that the Rainy Day Fund will contain up to 15% of the General Fund certification of the previous year. When deposits equal that amount, the fund is locked and the Constitution lists only four ways that the funds may be used.
First, a limited amount may be appropriated by the Legislature if there is an anticipation that the upcoming year will not produce as much revenue as the previous year. Second, a limited amount may be appropriated by the Legislature if the current year’s revenue has not equaled anticipated revenues. Third, a limited amount may be used in the event of an emergency if the Governor and a supermajority of both houses of the Legislature agree. Fourth, if there is at least $80 million in the fund and the Governor and the Speaker of the House and the President Pro Tempore of the Senate agree, up to $10 million may be used as an incentive to retain at-risk manufacturing jobs.
It is important to note that the Constitution requires that each option requires legislative action. Incredibly, over the past few months, somewhere between $240 million and $360 million has been removed from the rainy day fund by Governor Fallin’s appointed director of Office of Management and Enterprise Services, leaving a balance of ZERO in that fund. Of course the Speaker and the Pro Tempore say they were not aware of the removal of the funds.
Even more incredible is the fact that the chair of the House Appropriations and Budget Committee requested last week that a “special appropriation” of $4 million be made to the Department of Human Services from the Rainy Day Fund when it had a ZERO balance.
Section 23 of Article X of the Oklahoma Constitution apparently means nothing to those running state government. Not only do they empty the Rainy Day Fund without telling anyone, rumor is that for the second straight year they want to use another $200 million loan – i.e., sell another $200 million in bonds – to balance the state budget.
The chair of the Senate Appropriations and Budget Committee said last week that she hoped the money would be repaid to the Rainy Day Fund, otherwise, “we would be worse off than we are.” A “Wing and a Prayer” sounds very appropriate under the circumstances.
(Representative Perryman is a Democrat from Chickasha.)
MIKE W. RAY
Media Director, Democratic Caucus
Oklahoma House of Representatives
(405) 962-7819 office
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