2015 Senate Summation – week 5


WEEK 5 – 2015:

The full Senate has advanced Sen. Bingman’s incentive review proposals. Senate Bills 806 and 815 would establish a process to provide lawmakers with independent evaluations of economic incentives, and a clear picture of those that encourage growth and those that do not.

It’s time for us to give greater scrutiny to the numerous tax credits and incentives offered by the state and determine whether they are providing us with a return on our investment

  • We currently provide more than $1.7 billion in economic incentives, and in order to protect taxpayers we need to ensure they are accomplishing their goals
  • Ultimately, our purpose is to ensure that Oklahoma job creators are succeeding, and we can do that by making fiscally sound decisions on tax credits and economic incentives
  • Under current law, once tax credits and economic incentives are approved by the Legislature, we don’t have a system to provide us with reliable data on their effectiveness
  • This legislation would correct that problem, and ensure that lawmakers have the information to determine whether incentives are working as intended
  • Senate Bill 815 requires the development of review criteria to determine the fiscal impact of incentives, assess whether incentives are achieving goals, and make recommendations regarding whether incentives should be changed, modified or repealed. Under the measure, the Legislature would be provided with a report on incentives every December
  • Senate Bill 806 would require that any economic incentive include a measurable goal or goals when enacted
  • The full Senate this week approved Sen. Rob Standridge’s SB 560 – the Health Care Empowerment Act. The bill clarifies that nothing in state law prohibits patients and providers from entering into a direct primary care arrangement. It also states that direct care arrangements will not be regulated by the Insurance Department.
    • Under a direct care arrangement, doctors offer patients a fee for monthly services, or one-time fees for specific services
    • This facilitates a closer relationship between patients and providers at a time when many people are concerned about losing their relationship with their doctor due to the advancement of Obamacare
    • Consumers would also benefit       from more predictable pricing for health care, making the process of receiving health services more manageable
    • Market-driven reforms like this can drive costs down and streamline the process for both consumers and providers
    • In some states, it has been misconstrued that that a membership fee with a medical provider or a fee for a set procedure is insurance. This misunderstanding has driven up the cost of health care services
    • This legislation would prevent similar problems from occurring in Oklahoma, and protect doctor-patient relationships
  • Appropriations committee begins second round of budget hearings
    • The Senate Appropriations Committee met Wednesday to begin the process of revisiting the budgets of the 12 agencies receiving more than 90 percent of all state appropriated dollars
    • The Department of Corrections appeared before the committee at Wednesday’s meeting. Other agencies that will appear again include the Department of Education; Higher Education; Career Tech; Oklahoma Health Care Authority; Department of Human Services; Department of Mental Health and Substance Abuse; Office of Juvenile Affairs; Department of Public Safety; Department of Health; and the Office of Management and Enterprise Services
    • Appropriations Chairman Jolley said all 12 agencies will receive budget reductions and will be asked to present scenarios showing how they would handle those cuts
    • Jolley noted revenue figures have dramatically changed since agency heads first appeared before the panel, making it important to take a closer look at their budgets
  • Questions
  • On budget
  • Negotiations are ongoing, and we want to treat this challenge as an opportunity to more closely examine state spending and identify opportunities for savings and efficiencies
  • Our current budget situation underscores the need for us to take a closer look at economic incentives, protecting credits that are productive, and giving close scrutiny to credits that are not providing us with a return on our investment
  • The incentive reform proposals we advanced this week give us the opportunity to do that, and will provide us with the information needed to protect taxpayers and invest in incentives that actually work
  • Apportionments
  • We will be looking at all off the top apportionments as we continue the conversation on improving our budget structure and process
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