All Rainy Day Money can be spent
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Published: 18-Nov-2009
By Patrick B. McGuigan

An opinion from the office of Oklahoma Attorney General Drew Edmondson has concluded all legal conditions have aligned to allow appropriation of the entire balance in the Constitutional Reserve Fund. Better known as the Rainy Day Fund, the fund presently has a balance of a little less than $600 million.

In a November 2 letter, First Attorney General Tom Gruber told state Treasurer Scott Meacham “the first two” of three “triggering events” have occurred, permitting up to three-fourths of the fund to be spent. The remaining one-fourth could be spent upon a gubernatorial declaration of emergency and a super-majority concurrence from the Legislature, Gruber wrote in the letter, a copy of which was obtained by this reporter.

Public school leaders and directors of some agencies which have sustained across-the-board cuts in recent months due to the revenue crunch have asked for an immediate special session. Gov. Henry and legislative leaders have said they preferred to wait for the regular session to begin in February, but Henry indicated in recent days he is considering a January special session to address the issues. Further, the governor has also said he is now willing to consider spending much or all of the rainy day balance.

While many organizations dependent upon government revenue have clamored for a special session as soon as possible, a spending watchdog group, Oklahomans for Responsible State Government (OFRG), warns the revenue crunch could extend beyond the coming year. Some fiscal analysts believe government revenues will not recover to 2008 levels until 2012. OFRG has supported the concerns of legislative leaders who argue it is better to make further spending cuts now to avoid even deeper cuts next year.

Gruber told Meacham that updated “Rainy Day” language adopted by voters in 2003 as state Question 708 allows three-eighths of the fund to be appropriated when the state Board of Equalization certifies less money is available for the coming fiscal year than in the current year. Another three-eighths comes into play if the Board determines “a revenue failure has occurred with respect to the General Revenue Fund,” Gruber wrote.

The final one-quarter “may be appropriated, upon a declaration by the Governor that emergency conditions exist, with concurrence” by two-thirds majorities in both the House and Senate. Another means for appropriation of the final one-fourth is a declaration of emergency by the House Speaker and the President Pro Temp, with concurrence of three-fourths majorities in each chamber.

The Board of Equalization is scheduled to meet on Dec. 21, at which time revenue estimates for the next fiscal year will be reviewed.
 

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