Oklahoma Gov. Kevin Stitt vetoes key parts of $9.8B state budget, calls special session

Criticizing tax relief measures in the $9.8 billion proposed state budget package as insignificant for Oklahoma families, Gov. Kevin Stitt on Thursday vetoed parts of the budget package approved by state lawmakers.

Stitt also called lawmakers into a special legislative session on June 13 to eliminate the state's grocery sales tax and cut individual income taxes.

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The Oklahoma Legislature last week passed a $9.8 billion spending plan for the upcoming fiscal year that includes direct payments for taxpayers, targeted pay raises for state employees, new investments for some state agencies and socks away some funds in savings.

In a news conference Thursday, Stitt took issue with tax rebates of $75 for single tax filers and $150 for couples.

"It’s a political gimmick in an election year," Stitt said. "I never expected Republicans to take a page out of Joe Biden's liberal playbook and waste $181 million sending government checks out."

Stitt vetoed the direct relief payments in addition to a budget bill to eliminate the 1.25% tax on all vehicle sales.

The Oklahoma Legislature can override the governor's vetoes with two-thirds majorities in both chambers. Lawmakers on Friday are expected to attempt veto overrides of some bills.

"The House will respond to the governor's many inaccurate and misleading statements in due course," House Speaker Charles McCall, R-Atoka, said in a statement.

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Stitt did have some praise for the budget. He said he was pleased the plan includes pay raises for state law enforcement officers and $10 million for the attorney general's office to fight "federal overreach."

Senate Pro Tem Greg Treat, R-Oklahoma City, said his members, who stand ready to act on behalf of nearly four million Oklahomans, eagerly await the governor's vetoes.

"I am proud of the hard work done by the entire legislature for doing our Constitutional duty to write a state budget," Treat said in a statement. "This budget has substantial investments like raises for law enforcement officers and the elimination of the waiting list for the developmentally disabled, while also securing record savings of over $2.5 billion."

Stitt wants cuts to Oklahoma's income tax, grocery sales tax

Noting high inflation rates, Stitt said Oklahoma families need tax relief now, not when the direct payments are scheduled to go out in December.

Instead, he is asking the Oklahoma Legislature to pass a 0.25% cut to all individual income tax rates. The change would bring the state's top tax rate, which most Oklahomans pay, down to 4.5%.

If approved, that would follow a 0.25% rate cut that took effect Jan. 1.

The income rate cut and elimination of the state's 4.5% sales tax on groceries would save the average Oklahoma family about $453 each year, Stitt said. Combined, the two cuts would cost about the same as the tax relief proposed by lawmakers, Stitt said.

Republican budget writers expressed hesitation at the prospect of cutting taxes this year because of the uncertainty surrounding the state's long-term economic picture. Raising taxes, which requires support from three-fourths majorities in both chambers of the Legislature, is nearly impossible in Oklahoma.

House Minority Leader Emily Virgin, D-Norman, said she was glad to see the governor agreeing with Democrats that eliminating the state portion of the grocery tax should be a priority.

"What we've said is that it's time to focus on the (grocery) sales tax, the regressive tax that we have," Virgin said. "We've given income tax relief, we've given corporate tax relief, it's time to focus on that (grocery) sales tax."

Calling the state budget process opaque, Stitt also said he would line-item veto parts of the general appropriations bill, the backbone of the state budget. He suggested parts of the bill were a result of lawmakers of making "backroom deals" with lobbyists.

Stitt said he would veto $360,000 earmarked for printing attorney general opinions.

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He also planned to veto a $7.7 million appropriation for a per diem increase at two private prisons.

Governor complains he wasn't included in budget negotiations

Stitt complained that he was not shown the budget until it was already made public, at 8:45 p.m. the night before lawmakers started moving a package of more than two dozen budget bills through the legislative process.

"It's long overdue, but we need to have a real conversation as leaders in this state and as Oklahomans of how this budget process happens," Stitt said. "Why is it happening behind closed doors? Why are only a select few in charge, while the rest of us are expected to nod our heads and not even ask questions?"

House Speaker Pro Tem Kyle Hilbert, R-Bristow, said the governor's role in the budget process is limited, according to the state's constitution.

The governor presents his executive budget at the beginning of session. The Legislature's job is to review that proposal and the requests from state agencies, Hilbert tweeted.

"Constitutionally, the executive does not write the budget, the legislature does," Hilbert wrote. "Did the Governor get everything he wanted in this budget? No. Neither did the House or the Senate."

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Legislative Democrats have echoed similar transparency complaints about the budget process that have been dismissed by Republican lawmakers who write the budget.

However, Stitt's complaints appear to stem more from the fact that his office wasn't invited to be more involved in budget negotiations.

Later in the legislative session, House and Senate budget writers, legislative leaders and sometimes, representatives from the governor's office hash out budget details behind closed doors.

Senate Appropriations Chairman Roger Thompson, R-Okemah, recently dismissed the idea that the state budget process is opaque. Thompson, who plays a key role in writing the budget, noted the Legislature has bipartisan budget subcommittees that vet state agency budget requests.

Once the proposed budget was finalized, Thompson said he briefed members of the Senate Democratic and Republican caucuses about the details.

"There's a certain amount of discussion that goes on," he said. "I hear about this smoke-filled back room, and I've not found that yet."

The special session session on tax relief requested by Stitt would be separate from a special session legislative leaders have planned to determine how to spend $1.8 billion in pandemic stimulus funds from the federal government.

Contributing: Hogan Gore, The Oklahoman

Editor's Note: This story was updated to reflect that $7.7 million for a per diem increase at two private prisons was not included in the general appropriations bill that Stitt said he planned to line-item veto. 

This article originally appeared on Oklahoman: Oklahoma Gov. Kevin Stitt vetoes key parts of $9.8B state budget