Oklahoma legislative committees are considering the fate of roughly 2,500 bills dealing with a wide variety of issues, a number of which would impact local governments and the vast majority of Oklahomans whom they serve. Thanks to an important and relatively new fiscal reform measure enacted in 2010, “The Municipal Fiscal Impact Act” (MFIA), our representatives at the state Capitol can now know the fiscal consequences of their actions before voting to enact potential unfunded mandates on local governments and the folks back home.
That is, they can know this if committee chairmen honor the law's intent. Let's hope they do, enabling lawmakers to “look before they leap” into any unintended fiscal cliffs.
Cities and towns are the engines that drive Oklahoma's economy. They are where most Oklahomans live, work and shop. Their success is integral to the well-being of small businesses, schools, health care and other institutions. Oklahoma can't have a healthy state economy without healthy, functioning cities and towns.
Oklahoma municipalities must operate primarily on volatile sales tax dollars being collected from a gradually shrinking base to provide basic governmental services, under a dysfunctional financing system in serious need of reform. Until it gets overhauled, lawmakers at least need to avoid doing further harm to municipal governments, by thoughtfully evaluating legislation placing financial burdens on municipalities without providing corresponding funding sources. This is the heart and soul of the MFIA.
The MFIA requires a fiscal impact statement be provided committee members for proposed laws having a direct, adverse impact on municipal budgets. Too often, laws are passed with little consideration of their implementation cost on cities and towns. This is tantamount to the Legislature imposing a tax or fee increase on the folks back home or forcing reductions in local services, since municipalities already struggle to meet their budget obligations.
The MFIA doesn't prohibit passage of unfunded mandates. It merely aids their identification, informing legislators and municipal officials regarding the costs up front so they can plan for expenses while also suggesting less costly alternatives. The act further delays, until the following legislative session, implementation of mandates having a statewide minimum negative fiscal impact of $100,000, giving municipalities more time to evaluate and plan for the new requirements. This requirement can be waived by the Legislature in emergency situations.
As a former longtime legislative fiscal director, state and county finance official, and now a city manager, I've seen the unintended, damaging impact that too hastily considered legislation can have on our local governments and state economy. That's what led me to approach former House Speaker Chris Benge and Sen. Mike Mazzei with a long-overdue, fiscally conservative proposed reform, which under their leadership became the MFIA.
Here's hoping today's committee chairmen draw on this simple but important common-sense fiscal tool to ensure better-informed, more fiscally responsible policymaking, unlike what we see from their federal counterparts.
Enevoldsen is city manager of Bixby.