|
 |  | | << Back to Wellhead | 
| Service company work gives legislators unique view of budget March 2010 | |
| Facing a budget reduction of historic proportions, Oklahoma’s lawmakers are faced with difficult financial decisions.
For two of the state’s 149 legislators, the budget concerns are nothing new.
Rep. Danny Morgan is the Democratic leader in the House and president of Morgan Well Service. Sen. Bryce Marlatt is the former owner of a rig hauling company and is now a sales representative for Woodward drilling company Power Rig.
Their work in the oil and natural gas service industry puts their professional lives at the mercy of oil and natural gas prices just as their legislative lives are dependent on the success of Oklahoma’s energy producers.
“At the end of the day, when oil and gas prices are bad, everything is bad in Oklahoma,” Marlatt said. “It’s the lifeblood of our state. Everybody tried to say over the last 10 years that we’ve diversified and we’re not as dependent on oil and gas. There’s not a better example than right now of just how dependent we are on the oil and gas industry.”
Morgan said his eight years in office have been served as an oil and gas tutorial for many of his fellow legislators and state lawmakers, who lack a true understanding on the impact depressed oil and natural gas prices have.
“It’s a system of dominoes,” Morgan said. “When prices fall, production eventually falls. Then the dominoes start to fall. We not only lose the revenues from the gross production tax, but we lose income tax because people aren’t making as much overtime or they’ve lost their job and we lose sales tax because those workers aren’t spending as much money as they were.”
Morgan said one way to ease the impact of the volatility of oil and gas prices on the state budget is to plan budgets on a two-year cycle. The two-year budget plan was proposed in 1984 by Gov. George Nigh, promoted in 2002 by Democratic legislative leaders and resurrected this year by current gubernatorial candidate Jari Askins.
“Most businesses have a three, five or 10 year outlook,” Morgan said. “In government, it’s ‘How do we solve the crisis today?’ They’re reactive. To be successful in business, you have to be proactive. You have to anticipate what’s coming. You have to anticipate the changes you’ll have to make.”
Marlatt said the budget Oklahoma legislators face today is equivalent to 2005’s state budget, and the Woodward Republican said few state agencies complained then of budget issues. But when oil and natural gas prices increased dramatically and gross production tax receipts surpassed $1 billion, the windfall state revenues helped create new government jobs and expand the scope of state agencies.
“Instead of making one-time investments in our infrastructure, we hired more people and grew our agencies,” Marlatt said. “Our teacher retirement system is underfunded. We could have made it whole. We’ve got prisons that are falling down. We’ve got the worst roads and bridges in the country. We could have made one-time investments with that money that would have paid dividends for years.”
Both Morgan and Marlatt said the better budget decisions will be made when business-savvy lawmakers are put into office.
“The problem is you’ve got to have a business man running it,” Marlatt said. “If we had a law that in order to run a state agency you had to have 10 years of experience in your own business, things would be run a lot better.”
“There are four members of the Democratic House caucus that run a payroll. That’s it,” Morgan said. “When we start talking about running government like a business, you’ve got to understand how a business works.” |
| | | << Back to Wellhead |
|
|
 AD
|
| Issues |
|
|
| Topic |
|
|
|
|
|
