The state House Minority Leader Wednesday requested an Attorney General’s opinion on the constitutionality of a legislative dictate that diverted almost $7.9 million from the Oklahoma Higher Learning Access Program.
“The Legislature broke its promise to thousands of Oklahoma college students this year, and we think that was unconstitutional as well as immoral,” said Rep. Scott Inman, D-Del City, leader of the 29-member House Democratic Caucus. Because of the funding diversion, it appears that some students in OHLAP won’t receive the tuition assistance they were promised, he said.
OHLAP, also known as “Oklahoma’s Promise,” is a scholarship program that provides free college tuition to Oklahoma students whose family income is $50,000 or less and who maintain a certain high-school grade point average. According to the Oklahoma Policy Institute, a non-partisan independent ‘think tank’, OHLAP serves approximately 19,000 students at a total annual cost of about $60 million.
OHLAP is funded unlike any other state government program, David Blatt, director of the Oklahoma Policy Institute, pointed out.
“To ensure that the program is fully funded, the Legislature in 2007 guaranteed OHLAP ‘off-the-top’ state income tax collections,” Blatt recalled. Each December the state Board of Equalization certifies the amount of money that will be required the following year for OHLAP scholarships, based on estimates provided by the State Regents for Higher Education. The certified amount is then deducted from income tax revenues available for appropriation by the Legislature, and is deposited in the OHLAP trust fund.
This year the Equalization Board approved the Regents’ request for $57 million in income tax revenue from the General Revenue Fund.
However, in the General Appropriation bill, Senate Bill 2127, the Legislature instructed the State Board of Equalization to reduce the amount of income tax revenues earmarked for the OHLAP trust fund by $7,894,737.
That resulted in $7.5 million being incorporated into the total funds distributed throughout state government via general appropriations. (The Legislature can appropriate only 95 percent of certified revenue; that limitation reduced the $7.89 million withdrawal to $7.5 million in available funds.)
“We question whether the Legislature has the constitutional authority to order the state Board of Equalization to adjust the level of funding for OHLAP,” Inman said.
The Equalization Board is a constitutionally created board comprised of six statewide elected officials plus the state Secretary of Agriculture.
The Legislature “grants the Equalization Board various responsibilities, including the certification of funds available for appropriation,” Inman said. In addition, by its actions during the annual legislative session the Legislature can affect how much revenue the Equalization Board will certify, he continued.
“But instructing the Board to adjust the amount of funding, as was done in Senate Bill 2127, appears to be an unprecedented and legally questionable expansion of legislative power,” Blatt asserted in a blog post today.
The Equalization Board is scheduled to meet June 16 to make a final FY 2015 certification based on legislative changes enacted during this year’s session, Blatt noted.
“Raiding OHLAP and leaving its trust fund short of money was wrong,” Inman said. “We broke our promise.”
Siphoning $7.9 million from the trust fund will leave OHLAP unable to honor all of its financial obligations before the end of next year, the State Regents staff predicts. Although the amount and the timing of the anticipated shortfall are unknown, the Regents expect to need a supplemental appropriation next year, Blatt wrote. “The Regents were not consulted in this decision,” he added.
The Legislature’s $7.9 million diversion also “has subverted the intent of the 2007 law, which was to keep itself out of the annual funding process for OHLAP,” Blatt contends. “If this precedent stands, the Legislature could make it an annual practice to adjust the amount of funds allocated to the program…”
To close a $188 million gap in the FY 2015 budget, the Republican leadership of the Legislature scraped together nearly $300 million in one-time revenues from almost 30 funds, including the OHLAP trust fund, cash reserves, agency revolving funds and other state accounts, Inman and Blatt related.
The diversion of OHLAP trust funds “seems to rest on very shaky legal footing,” Blatt contends.