Governor Mary Fallin

Governor Mary Fallin today said the Legislature must return in special session to deal with the $215 million shortfall caused by a proposed smoking cessation fee being struck down.

“No money can be spent from any state fund unless the Legislature specifically appropriates it,” said Fallin. “Let’s be clear. The Office of Management and Enterprise Services (OMES) does not have the authority to transfer monies to the affected agencies from different sources without legislation directing him to do so.” 

Article 5, Section 55 of the Oklahoma Constitution states that no money shall be paid out of the state treasury, except through an appropriation by law.

Fallin said state law (Title 62, Section 34.55) allows the director of OMES to borrow money from treasury funds to satisfy monthly allocations of appropriations made from the General Revenue Fund, but the appropriation has to be made by the Legislature.

The three agencies that received the bulk of the money from the proposed cessation fee are the Department of Human Services (DHS), the Department of Mental Health and Substance Abuse Services (DMHSAS), and the Oklahoma Health Care Authority (OHCA).

DMHSAS would have received $75 million (about 23 percent of its total appropriation), OHCA would have received $70 million (about 7 percent of its total appropriation), and DHS would have received $69 million (about 10 percent of its total appropriation).

Without legislative intervention, DMHSAS said it would run out of state appropriations in November. OHCA said it would run out of state funds in January and DHS said it would out of state funds in May.

OK Gov. Mary Fallin with David Arnett, Tulsa Today

The funding shortfall is the result of the Oklahoma Supreme Court decision last week striking down a smoking cessation fee approved this past legislative session.

Fallin said she and her staff have been discussing options with legislative leaders of both parties.

“A special session is the best option,” the governor said. “Failure to meet in special session would mean $215 million would be cut mostly from these three state agencies. These agencies and the people they serve cannot sustain the kind of cuts that will occur if we do not find a solution.”