Capitol Updates

 This week's Capitol Updates newsletter:


December 17, 2018

With the appointment of House leadership by Speaker Charles McCall last week, the picture of legislative leadership for next session is coming into focus. The Senate had already announced its leadership appointments about a week ago. It came as no surprise that Majority Floor Leader Jon Echols (R-OKC) and Appropriations and Budget Chairman Kevin Wallace (R-Wellston) will remain in their current positions. Both are good at what they do and helped lead the House through the turbulent sessions of the past two years. They'll work with newly appointed Senate Majority Leader Kim David and Senate Appropriations Chairman Roger Thompson next session.

Echols has a broad range of interests and the energy and intellect to move the needle forward on them. Wallace learned the ropes under fire, literally, when Speaker McCall removed former Appropriations Chair Leslie Osborn in 2017 over a dispute about revenue. Vice-Chairman Wallace took over and stabilized the situation. He then led the committee through the 2018 session. Undaunted, Osborn maintained a strong voice in the legislature and followed that with a successful underdog statewide campaign for Labor Commissioner.

Oklahoma state government has been described as a three-legged stool: The governor, speaker and president pro tempore. This has certainly been true in the sense that, to accomplish something truly significant for the state and difficult, at least one of these three top leaders must take on the issue as his or her own cause. Hopefully all three will see value in the proposal. Working together they can accomplish most anything that is truly important to them and that needs to get done. But if they don't agree in the beginning, one of the three must see the issue as something important enough to use the leverage they have with the other two. This is often perceived by the public as "squabbling" between the House and Senate or the Senate and governor, etc., but it may just be one of these three leaders trying to bring along the others on a difficult issue.

The three leaders do not work alone. Each has a team that will be important in helping determine "which hill to die on," as the legislative saying goes. That's where the leadership announcements by the House and Senate of the past couple weeks comes into play. With so many new legislators feeling their way at the Capitol, the leadership teams are going to be more important than usual next session. Gov.-Elect Stitt, himself a newcomer to state government is in the process of putting his team together. How successful each leader is will depend on the value of his ideas, the strength of his team, his ability to marshal the support of his members and his effectiveness in persuading or negotiating with the other two legs of the three-legged stool.

Wallace to remain House A&B chair; Echols reappointed floor leader

Shawn Ashley, eCapitol

Rep. Kevin Wallace will remain chair of the House Appropriations and Budget Committee and Rep. Jon Echols will continue to serve as House Majority Floor Leader, House Speaker-designate Charles McCall announced Friday.
"These are very talented, capable lawmakers, and I am excited about the opportunity to work alongside them to lead the House of Representatives," said McCall, R-Atoka. "Voters gave us the largest Republican supermajority in state history, and we believe they trust our caucus to solve the state's problems. We have an opportunity to move Oklahoma forward during the upcoming session by focusing on education, infrastructure and healthcare and by making government more efficient and accountable to taxpayers."
Wallace, R-Wellston, succeeded former Rep. Leslie Osborne, R-Mustang and now commissioner of labor-elect, to lead the House Appropriations and Budget Committee following the 2017 legislative session. He has chaired the committee through two special and one regular session.
Rep. Jon Echols, R-Oklahoma City, served as floor leader for McCall in both sessions of the 56th Legislature, as well as during the two special sessions.
Other leadership positions announced Friday by McCall include:
* Majority Whip Terry O'Donnell, R-Catoosa;
* Deputy Majority Leader Mike Sanders, R-Kingfisher;
* Deputy Majority Leader Josh West, R-Grove;
* Deputy Floor Leader John Pfeiffer, R-Orlando; and
* Deputy Floor Leader Dustin Roberts, R-Durant.
McCall said he will be announcing additional leadership posts during the coming weeks.
Lawmakers return to the Capitol Jan. 8 for organizational day, when McCall is expected to be elected formally to a second term as speaker. The Legislature will then recess until Feb. 4.

AG urges adopting marijuana working group's recommendations legislatively

Tyler Talley, eCapitol

Attorney General Mike Hunter submitted a letter to the co-chairs of the joint legislative medical marijuana working group Monday advising against the adoption of their testing and labeling recommendations by the State Board of Health as new administrative rules.
In a letter addressed to Sen. Greg McCortney, R-Ada, and Rep. Jon Echols, R-Oklahoma City, Hunter argued several of the working group's recommendations offered to the State Board of Health for possible consideration fell out of the agency's authority granted under State Question 788 on the promulgation of rules pertaining to medical marijuana.
The joint, bipartisan working group met 12 times from August to October, with meetings largely consisting of expert and stakeholder testimonies. The group also held open rule-making meetings, leading to a series of testing and labeling recommendations they approved at the last meeting in October.
Recommendations offered up by the working group included, but were not limited to:
* Allowing the sale of marijuana seedlings as well as mature marijuana plants.
* Removing the requirement that the patient's and physician's names be included on labels.
* Adding language to lab accreditation requirements specifying provisional approval acceptable for the May 19 deadline.
* Clarifying language on the warning label for untested medical marijuana noting the product has not been tested in accordance with state law to prevent businesses from self-implementing unsanctioned testing practices and forgo the untested warning label.
* Requiring terpene testing.
* Standardizing a warning included on labels pertaining to the use of medical marijuana by pregnant women.
Hunter argued in his letter, however, that a number of the working group's recommendations fell outside of the authority of Oklahoma Medical Marijuana Authority's (OMMA) Food Safety Standards Board and the Oklahoma State Department of Health (OSDH).
"The legislative working group has recommended that the OSDH's food safety board issue new regulations on a variety of subjects, including new labeling requirements, new laboratory accreditation requirements, and new testing requirements for cannabinoids and terpenes," Hunter wrote. "We have determined that a number of these regulations were not contemplated by SQ788 which created the food safety board. Neither the OSDH generally nor the food safety board specifically has the authority to promulgate these rules under current law."
A number of the recommendations offered by the working group, he continued, were not "in line with current food preparation guidelines" and therefore exceed the bounds of the Food Safety Standards Board's mandate since they have no analog to existing food safety standards.
An example highlighted by Hunter related to the legislators' terpenes testing recommendation.
"It is my understanding that terpenes are indicators of medical qualities, rather than estimates of food safety risks," he posited in his letter.
Hunter also pinpointed the working group's call for the extensive testing of medical marijuana, noting "no other food product is generally subject to such extensive testing." He argued the regulations proposed, therefore, went beyond existing food preparation standards.
Later in his letter, Hunter conceded the recommendations were also likely to be met with additional lengthy and costly legal challenges "even when they are legally valid and plainly beneficial to public health and safety."
"Responding to these lawsuits would require significant briefing, and a court is unlikely to reach a final ruling before the next legislative session begins," Hunter posited. "Thus, it is likely to be far more efficient, timely, and legally sound to pursue these public health and safety reforms through legislation rather than regulation."
Hunter closed by commending the work of the legislators involved in the working group, reiterating his recommendation they implement their reforms through new legislation rather than new administrative rules.
Echols was attending the House Republican Caucus retreat Tuesday, but did weigh-in on the Hunter's letter on Twitter.
"I appreciated the General's work here," Echols wrote. "I expect the Legislature to pass these bi-partisan testing and labeling recommendations early next session."
A series of testing and labeling standards, related exclusively to edible medical marijuana products, were taken up and approved Tuesday by the State Board of Health on the recommendation of the Food Safety Standards Board and with Hunter's approval.

Judge upholds 2015 waiting period law

Shawn Ashley, eCapitol

An Oklahoma County district judge declined Tuesday to block a 2015 law that put in place a 72-hour waiting period for women seeking abortions.
"After weighing the expert testimony offered by both parties, the court holds that HB 1409 furthers a valid and legitimate state interest in protecting the patient and that it does not unduly burden or place a substantial obstacle in the path of a woman's right to choose," Oklahoma County District Judge Patricia Parrish wrote in the order filed Tuesday.
The New York City-based Center for Reproductive Rights challenged the law before it took effect in 2015 on behalf of Tulsa Women's Reproductive Clinic. Parrish refused to issue a temporary injunction in 2015 that would have enjoined the law from taking effect.
The bill, by former Rep. Lisa J. Billy, R-Purcell, and Sen. Greg Treat, R-Oklahoma City. The bill increases the time period of voluntary and informed consent prior to an abortion to 72 hours. It requires printed materials concerning abortion to contain the statement, "Abortion shall terminate the life of a whole, separate, unique, living human being." The bill requires any facility performing abortions that has a website to publish an easily identifiable link on the homepage of such a website that directly links to the State Board of Medical Licensure and Supervision's website that provides informed consent material under the Woman's Right-to-Know Act. It specifies how the link must look and what it should say.
"With only four clinics providing safe and legal abortion services in the entire state, Oklahoma women already face many challenges. This medically unnecessary 72-hour waiting period insults women and adds needless hurdles to accessing abortion care," said Nancy Northup, president and chief executive officer of the Center for Reproductive Rights. "We will continue to fight for women's dignity and autonomy to make decisions about their health and their futures, free from political interference."
The Center for Reproductive Rights said it was exploring its legal in light of the decision. The law made Oklahoma the fifth state with a 72-hour delay. The other states include Missouri, North Carolina, South Dakota, and Utah. Louisiana also passed a 72-hour delay, which is currently blocked by a federal court.
Parrish took no action Tuesday concerning another 2015 bill challenged in the center's original case, House Bill 1721. That bill, by former Rep. Pam Peterson, R-Tulsa, and former Sen. Josh Brecheen, R-Coalgate, establishes the Oklahoma Unborn Child Protection from Dismemberment Abortion Act. The bill makes it unlawful to perform or attempt a dismemberment abortion unless necessary to prevent serious health risk to the mother. The bill states only a physician or someone acting as a physician may be liable for performing a dismemberment abortion. The bill specifies who may maintain a cause of action for injunctive relief or civil damages against someone who has performed such an abortion. It states violators will be fined $10,000 and/or imprisoned for not more than two years.
Parrish said she deferred action on that bill pending the outcome of the Oklahoma Supreme Court's final decision in a case involving House Bill 2684 from 2014. That bill was held unconstitutional by the court in 2014 but subsequent filings have kept the case alive.
The bill, by former Rep. Randy Grau, R-Edmond and Treat, states legislative findings regarding mifepristone (brand name Mifeprex).and states that based on those finding the purpose of the bill is to protect women from the dangerous and potentially deadly off-label use of abortion-inducing drugs; to ensure that physicians abide by the protocol approved by the FDA for the administration of abortion-inducing drugs, as outlined in the drugs' final printed labeling (FPL); and to legislatively overrule the decision of the Oklahoma Supreme Court in Cline v. Oklahoma Coalition for Reproductive Justice (No. 111,939) and ensure that should such questions be presented before that court in the future it will reach the proper result that this act does not ban use of misoprostol in chemical abortion (and allows it as part of the FDA-approved Mifeprex regimen) nor prevent the off-label use of drugs for the treatment of ectopic pregnancy. The bill modifies the definition of "abortion inducing drug." The bill defines "abortion" to mean the use or prescription of any instrument, medicine, drug, or any other substance or device intentionally to terminate the pregnancy of a female known to be pregnant with an intention other than to increase the probability of a live birth, to preserve the life or health of the child after live birth, to remove an ectopic pregnancy, or to remove a dead unborn child who died as the result of a spontaneous miscarriage, accidental trauma, or a criminal assault on the pregnant female or her unborn child. The bill removes the definition of "federal law" and defines "Mifeprex regimen," "Mifepristone" and "Misoprostol." The bill removes references to "RU-486." The bill clarifies language related to knowingly or recklessly giving, selling, dispensing, administering, prescribing, or otherwise providing an abortion-inducing drug. The bill permits physicians to provide the Mifeprex regimen in accordance with the FDA-approved dosage and administration instructions for both mifepristone (brand name Mifeprex) and misoprostol.

New bill would end "Soon-to-be- Sooner" program

Tyler Talley, eCapitol

Sen. Paul Scott filed legislation Wednesday that would terminate the "Soon-to-be Sooner" (STBS) program at the Oklahoma Health Care Authority (OHCA), potentially putting the health care services for thousands of low-income pregnant women at risk.
Scott, R-Duncan, said in a press release Thursday he filed the bill as a means to "bring light the fact that the federal government is forcing states and hardworking taxpayers to foot the bill for illegal immigrants to have their babies in the U.S."
He added, "This isn't right."
SB0040, by Scott, R-Duncan, ends the STBS beginning Jan. 1, 2020, with all program participants receiving the benefit prior to Jan. 1, 2020, allowed to continue until final services are received.
The program was first established in April, 2008, as a limited scope benefits for pregnant non-citizens below 185 percent of the federal poverty line (FPL). Pregnant citizens under 185 percent FPL received full scope benefits in the traditional SoonerCare program.
According to OHCA, the STBS program covered 9,856 individuals in fiscal year 2018. Of those 3,629 were Oklahomans and 6,227 who were non-citizens/undocumented immigrants. The program costs over an estimated $15.74 million; the federal government pays $14.8 million of the cost with Oklahoma covering the remaining $907,000.
"As a medical professional, I understand the importance of prenatal care but these mothers are illegal immigrants," Scott continued. "Our responsibility is to the taxpayers of this state, not illegal immigrants."
Scott argued the program also discourages illegal immigrants from seeking citizenship.
"Why would they go through the hassle of seeking citizenship or returning to their home country when we're providing them free services," Scott posited. "It makes no sense. If they can fill out paperwork for free medical care, they can fill out paperwork to become taxpaying citizens and pay for their health services like other Americans and Oklahomans."
The program falls under the Children's Health Insurance Program (CHIP) authority. Given CHIP's Maintenance of Effort provisions were set to expire on September 30, 2019, Congress passed and President Donald Trump ultimately signed a resolution in January extending the program through September 30, 2027.
Should the state eliminate the program, it would fail to meet the requirements under CHIP and be considered noncompliant therefore no longer eligible for the federal dollars provided under CHIP.
"I'd like to encourage Oklahomans to call their congressmen and urge them to remove the requirement to cover noncitizens under the CHIP," Scott argued. "Our healthcare system is in chaos so it makes no sense that the federal government is making the problem worse by covering thousands of illegal immigrants instead of holding them accountable and making them come to our country legally."

Stitt joins other governors meeting with Trump

Shawn Ashley, eCapitol

Oklahoma Governor-elect Kevin Stitt joined a bipartisan group of other newly-elected governors Thursday to meet with President Donald Trump.
"We have some real stars in the room," said Trump. "And they became stars because of the way they handled themselves. I could almost say - I think I could pretty much say... most of them have become stars, if not all. Because you won. Winning is a wonderful thing."
Trump endorsed Stitt in the general election's gubernatorial campaign. Vice President Mike Pence, who attended a rally in Oklahoma on Stitt's behalf, participated in Thursday's meeting.
Like the president, Stitt emphasized his business experience and outsider status on the campaign trail.
"That was a great victory. Great job," Trump told Stitt during Thursday's meeting.
In a statement, Stitt said, "It was an honor to join a bipartisan group of governor-elects and represent Oklahoma in a meeting with President Trump. I shared with the president about how his tax cuts and deregulation agenda is helping Oklahoma's economy and how my administration will be focused on leveraging these federal accomplishments to grow and diversify our great state."
Stitt said he also met with Secretary of Commerce Wilbur Ross to discuss ways to better utilize the Port of Catoosa and methods for leveraging our state's Federal Opportunity Zones.
"My time at the White House concluded by meeting with the ambassador of trade where I expressed my priority to increase exports of Oklahoma agriculture products and pursue larger international markets as we set our sights on expanding Oklahoma's presence in the global marketplace," said Stitt.

Board of Health backs Bates for permanent health commissioner position

Tyler Talley, eCapitol

The president of the State Board of Health voiced support Tuesday for Tom Bates, interim commissioner of health at the Oklahoma State Department of Health (OSDH), to assume the role permanently when the position becomes a gubernatorial appointment.
Board President Tim Starkey took a moment of personal privilege at Tuesday's meeting during his report to his fellow board members to commend Bate's work with the agency, likely the last before the board transitions to an advisory body on Jan. 14.
After Jan. 14, all of the board's authority will transition to the Commissioner of Health. The commissioner will be appointed by Governor-elect Kevin Stitt, who will also be sworn into office on Jan. 14, under legislation approved in 2018.
Starkey, speaking on behalf of the board, argued Bates would be an apt candidate, moving from interim to permanent commissioner with the governor and Legislature re-working the statutory qualifications mandatory for the position to allow for that.
"We want them to look out for the good of the department and the good of the health of the state of Oklahoma," Starkey posited.
"We're very hopeful and very proud of the progress we've seen under the direction of Mr. Bates," Starkey related. "We would like to see that continue and while we don't have much control over the next commissioner, the interim status of the current commissioner is a little bit detrimental in terms of making progress to the health of this state and the business of the health department."
He continued, "It's very concerning if there's not some stability there in the position of commissioner."
Starkey concluded by saying the board would remain a supportive element and happy to help Stitt and his transition team as they see fit.
"We want to be a true advisor for them," he summarized.
When asked if he would be open to accepting the position if asked, Bates noted there were some things undertaken during his time with the agency he would like to see through to the end.
"If the Governor-elect wants to talk about it, I'll sit down and talk to him about it," Bates responded.
Bates first came to the agency in April as a successor to former Interim Commissioner Preston Doerflinger, who resigned from the position in February less than 24 hours after The Frontier, a Tulsa-based nonprofit news website, reported on two 2012 incidents in which Doerflinger was alleged to have choked his now ex-wife. Prior to his OSDH tenure, Bates served as Gov. Mary Fallin's special adviser on child welfare and Pinnacle Plan implementation.
"When I got here in April...things were pretty tense," Bates related during his report Tuesday. "I think it's fair to say we were in a crisis mode."
Bates commended the work of OSDH staff in meeting numerous challenges throughout the coming year, included the passage of State Question 788 and the reduction-in-force later deemed unnecessary by a grand jury.
"I feel pretty good to say we're not in a crisis mode now but now is where the tough work begins of having long-term sustained culture change at our agency," Bates said. "There's still a lot of work to do there."
A critical factor in achieving that change, he continued, feel on maintaining open lines of communication among the agency, its key stakeholders and city/county health departments across the state.
"That long-term culture change is going to take some effort and some real digging in," he added.

November General Revenue Fund collections top estimate, prior year

Shawn Ashley, eCapitol

General Revenue Fund collections in November exceeded both fiscal year 2019's estimate and prior year collections, the Office of Management and Enterprise Services reported Tuesday.
General Revenue Fund collections for the month, which are a subset of the gross receipts reported by State Treasurer Ken Miller, were $502.2 million. That amount was $75.0 million or 17.5 percent above the month's estimate and $111.5 million or 28.6 percent over November, 2017, collections. Office of Management and Enterprise Services (OMES) Executive Director Denise Northrup noted the growth over prior year collections was driven mostly by law changes that took effect this year.
Gross production tax (GPT) collections did particularly well, totaling $79.1 million. That amount was $43.4 million or 121.6 percent above the estimate and $55.7 million or 237.7 percent above the prior year. Northrup said that was largely due to meeting the $150 million cap on specific funds that receive a portion of gross production oil collections earlier than expected. As a result, she explained, more revenues were deposited into the General Revenue Fund in November than originally anticipated.
Northrup, however, urged caution when looking at those numbers. "Regarding GPT, the lag between production and collections is usually about two months and the November collections reflect prices from September when West Texas Intermediate Crude Oil (WTI) prices averaged $70 per barrel," Northrup said. "So the returns we are looking at for this month aren't reflecting the falling oil prices we are seeing right now."
West Texas Intermediate crude closed below $52 per barrel Tuesday.
Major tax categories in November contributed the following amounts to the GRF:
* Total income tax collections of $117.9 million were $13.5 million, or 12.9 percent, above the estimate and $48,000, or 0 percent, below the prior year. Individual income tax collections of $117.9 million were $13.5 million, or 12.9 percent, above the estimate and $48,000, or 0 percent, below the prior year. Corporate income tax collections were net zero and did not contribute to the total.
* Sales tax collections of $187.7 million were $1.1 million, or 0.6 percent, above the estimate and $12.0 million, or 6.9 percent, above the prior year.
* Gross production tax collections of $79.1 million were $43.4 million, or 121.6 percent, above the estimate and $55.7 million, or 237.7 percent, above the prior year.
* Natural gas collections of $34.1 million were $6.2 million, or 22.4 percent, above the estimate and $14.1 million, or 70.4 percent, above the prior year. Oil collections of $45.0 million were $37.2 million, or 473.0 percent, above the estimate and $41.6 million, or 1,215.8 percent, above the prior year.
* Motor vehicle tax collections of $16.0 million were $1.7 million, or 11.6 percent, above the estimate and $1.3 million, or 9.1 percent, above the prior year.
* Other revenue collections of $101.5 million were $15.3 million, or 17.8 percent, above the estimate and $42.6 million, or 72.2 percent, above the prior year.
November's collections are the last full month numbers that will flow into the FY2020 revenue estimate that the Board of Equalization will consider Dec. 19.
"The Board of Equalization meets next week which will give us a better picture of the state's fiscal health going into FY2020," said Northrup. "At this point the year-to-date numbers, as opposed to the monthly comparison, give us a better idea of the state's financial outlook."
Total collections over the first five months of the fiscal year are $95.4 million or 4.0 percent above the estimate to date and $314.1 million or 14.6 percent above prior year collections.

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