A relatively new legislative watchdog office uncovered millions in questionable spending from a deal the Oklahoma Tourism and Recreation Department inked with a local barbecue chain to open new state park restaurants.
That same entity has been credited with spurring changes in how state leaders disperse federal stimulus funds.
And $32.5 million in new funding to eliminate Oklahoma's 13-year wait for developmental disability services can partly be traced back to a report from the office that showed smaller financial investments intended to reduce the waiting list weren't working.
When Republican legislative leaders created the Legislative Office of Fiscal Transparency three years ago, they envisioned an impartial entity to review state agency programs and spending.
They say LOFT has already exceeded their expectations.
LOFT conducts evaluations of state agencies and programs based on legislative priorities, current events and other factors. The evaluations are intended to improve the delivery of state services, boost government efficiency and save taxpayer dollars.
House Speaker Charles McCall, R-Atoka, said LOFT can root out wasteful and duplicative government spending.
"It's the right thing for the taxpayers of Oklahoma that they know that there's accountability on how their tax dollars are being spent and utilized," he said. "I think it's a great entity to help us identify how we can do things better."
Lawmakers wanted independent look at government spending
Senate Pro Tem Greg Treat, R-Oklahoma City, who authored the 2019 legislation to create LOFT, said he had the nonpartisan Congressional Budget Office in mind when envisioning what should be created on the state level.
Lawmakers were wholly dependent on state agencies for details on their budgets and programs, Treat said. The Legislature needed an independent look at state finances rather than having to take agencies at their word, he said.
"We went from being in the dark on a lot of information to getting to see a lot more insight," he said.
Director Mike Jackson has led LOFT since May 2020. His team now includes about a dozen people.
A former lobbyist and executive vice president at the State Chamber, Jackson represented Enid for 10 years in the Oklahoma House that included a two-year stint as speaker pro tempore.
The Legislature appropriates $1.7 million annually to fund LOFT. When lawmakers created the entity, they repealed a similar venture called the Agency Performance and Accountability Commission.
LOFT is better because it's a freestanding entity that's independent of the executive branch and largely free from legislative influence, McCall said. The earlier commission was made up of gubernatorial and legislative appointees.
"You've got $1.7 million annually that's potentially looking at a $9 billion appropriated budget and the federal money that's coming in on top of that, so a total spend of the state that's probably around $22 billion," McCall said. "It's a very small investment and a very high return."
LOFT was modeled off similar offices in New Mexico and Mississippi, Jackson said.
Before publicly releasing its findings, LOFT communicates with the state agency being evaluated and gives the entity a chance to respond. Some agencies have pushed back against or openly criticized LOFT's findings.
But even just asking questions about an agency's strategic vision and program delivery helps, Jackson said.
After LOFT dug into the Tobacco Settlement Endowment Trust, the entity changed some of its programs to spread its grant funding to regions of the state that were not receiving aid, Jackson said. TSET was initially critical of the LOFT report, and questioned why the watchdog office wasn't pushing lawmakers to implement new policies to reduce tobacco use.
Jackson said changes like those at TSET are what motivates him to continue LOFT's work.
"We're not here to seek glory," he said. "We're here to perform a duty and ensure that Oklahoma government and the delivery of that government is transparent and improved, especially from an efficiency standpoint."
What has LOFT accomplished?
The office has released 17 reports that include more than 200 recommendations for state agencies and lawmakers. Some of those suggestions have been put into 21 pieces of legislation, seven of which have become law.
In one of its most noteworthy reports, LOFT raised numerous questions about the Oklahoma Tourism and Recreation Department's contracts with Swadley's Foggy Bottom Kitchen to operate eateries in six state parks.
LOFT determined the agency lost $12.4 million in taxpayer funds because there was insufficient oversight of the now-defunct deal that has since come under scrutiny from the Oklahoma State Bureau of Investigation and a special House committee.
Jackson said he hopes his office never finds anything so egregious again.
"I do think that our report really ... encouraged more questions to be asked, which will ultimately lead to more answers on what happened," he said.
Jackson also said a LOFT report on CARES Act spending ultimately changed how the Legislature is handling federal pandemic relief funds appropriated through the American Rescue Plan. Lawmakers are taking a greater role in spending the latest round of federal relief funds after Gov. Kevin Stitt's administration largely decided how to spend $1.26 billion in CARES Act money.
In a 2021 report, LOFT was critical of how the Stitt administration spent CARES Act funds. Executive branch officials slammed the report as full of inaccuracies and said there was documentation justifying all of the spending.
The Oklahoma Legislature also adopted several LOFT recommendations pertaining to regulating the state's medical marijuana industry.
Lawmakers passed and Stitt approved this year a bill to implement a nearly two-year moratorium on issuing new medical marijuana business licenses.
Other new laws that stem from LOFT recommendations include making the Oklahoma Medical Marijuana Authority a standalone state agency and the agency implementing a secret shopper-style cannabis program. The OMMA has also increased its coordination with other state agencies to regulate medical cannabis.
Treat, who leads the state Senate, credited LOFT with the Legislature's decision to devote $32.5 million in new funding to eliminate the Department of Human Service's developmental disability waiting list.
After LOFT studied local teacher compensation, lawmakers approved legislation touted by Stitt that will allow the state to use some lottery funds to match salary increases offered by local districts to certain teachers. The LOFT report similarly recommended the state set aside funds to help districts fill critical teaching positions.
Some legislative Democrats pushed back on the report that said Oklahoma leads the way in regional teacher pay when adjusted for cost of living and state and local tax burdens. The National Education Association ranks Oklahoma teacher pay at third or fourth in the region, depending on the year in question.
After the report was released, Democratic Rep. Melissa Provenzano, of Tulsa, accused LOFT of inflating the numbers to make it look like "everything is coming up roses" in Oklahoma. Many Republican lawmakers touted the report's findings.
LOFT typically factors in the cost of living when making comparisons across state lines, Jackson said. He also said the National Education Association recommends states factor in the cost of living and a teacher's purchasing power when making salary comparisons.
What's next for the watchdog office?
A member of the LOFT Oversight Committee, Rep. Cyndi Munson, D-Oklahoma City, opposed the creation of the watchdog office because she thought it would duplicate work being done by legislative staffers.
Munson said she appreciates the deep dives into various state government functions and services, but she said the agencies or programs chosen for evaluations feel rather arbitrary. She questioned whether politics were at play in those decisions.
She said she wants to know more about what, if anything, happens after LOFT presents its findings to the oversight committee — a bipartisan and bicameral legislative body that oversees the watchdog office.
The oversight committee should have in-depth discussions about what policy changes should be made based off of LOFT reports, she said. Munson also questioned whether state agencies were changing any of their practices following LOFT evaluations.
"We can't just have these meetings and have these conversations and then it stops there," she said.
LOFT is working on follow-up reports to detail any changes that occurred at agencies or within programs they previously evaluated. Those reports will be complete about a year after the initial evaluation.
Treat said he's hopeful that over time LOFT can do long-term evaluations of policy changes to determine if they were effective.
"As a legislator, one of the things that I have found somewhat frustrating when I look back is I've been able to be a part of improving Oklahomans' lives," he said. "It feels good in the moment, and then you move on to the next fight and the next issue.
"It'll be nice to have a group within the Legislature to look at whether that really hit the target."
OKLAHOMA CITY - As it enters its third year and second legislative session, the Legislative Office of Fiscal Transparency (LOFT) is reshaping state policymaking with major improvements in legislative research, data and state agency accountability efforts. "Legislative scrutiny of tax dollars has never been higher, thanks to LOFT," said House Speaker Charles McCall, R-Atoka. "LOFT's accountability efforts are already producing strong bills and a more informed legislative body. The benefit is the taxpayer, whose resources are now better understood, used and protected from abuse." LOFT's most recent report, released this month, found regulation of Oklahoma's medical marijuana industry severely lacking, and recommended a moratorium on licenses until remedial efforts occur. The report's recommendations are currently under legislative consideration. To date, LOFT has delivered a dozen other reports, including reports that found: Lack of substantial progress toward reducing the state's years-long waiting list for services to the developmentally disabled. Oklahoma's teacher pay ranks first in the region and 21st in the nation when adjusted for cost-of-living and tax burden. Oklahoma's tobacco use remains among the nation's worst despite high levels of anti-tobacco government spending and continued protection of the Tobacco Settlement Endowment Trust. Oklahoma's fragmented funding approach to early childhood education limits accountability and effectiveness. Within those reports are 160 recommendations and policy ideas, 25 of which have resulted in legislation enacted or pending. "What I love about LOFT is it isn't a 'gotcha' group. Its true value is recommending solutions to the problems it finds," said Rep. Jeff Boatman, R-Tulsa, a member of the LOFT oversight committee. "LOFT's recommendations become starting points for us, as legislators, to begin fixing problems for the people of Oklahoma. As a legislator, I find the data-driven, solutions-oriented information LOFT provides incredibly beneficial to those efforts." Enacted legislation recommended by LOFT includes House Bill 2932, which prohibits state agencies from using federal relief funds in a manner that would result in future state funded expenses, unless expressly authorized by the Legislature, after LOFT identified questionable pandemic relief spending. Pending legislation includes House Bill 3097, which implements LOFT's recommendation to improve effectiveness of county road projects by aligning distribution of county road and bridge funds with the Oklahoma Department of Transportation's eight-year transportation plan. Another 25 LOFT recommendations have been enacted by agencies, including: Clearer state budget information from the Board of Equalization Better collaboration on school bus routes between the State Department of Education and Oklahoma Department of Transportation Better career path tracking of Oklahoma's Promise scholarship recipients by the Oklahoma State Regents for Higher Education. LOFT was created by legislation in 2019 and is overseen by a bicameral, bipartisan, 14-member oversight committee of legislators appointed by the House speaker and Senate president pro tempore. "Improvements are occurring and LOFT is working as intended," said House Appropriations & Budget Chairman Kevin Wallace, R-Wellston, who serves as a co-chair of the LOFT Oversight Committee. "LOFT has proven its worth to the Oklahoma Legislature and its value to Oklahoma taxpayers. I'm pleased with the progress we've seen in reporting on the efficiency and effectiveness of spending by many of our top state agencies. I look forward to the continued work of this office under the direction of the Legislative Oversight Committee." The office has statutory authority to examine and evaluate the finances and operations of all departments, agencies and institutions of Oklahoma and all its political subdivisions. LOFT's mission is to assist the Oklahoma Legislature in making informed, data-driven decisions that will serve the citizens of Oklahoma by ensuring accountability in state government, efficient use of resources and effective programs and services. "Having been around the Capitol since the early 1990s, I can say unequivocally that LOFT is one of the most transformational accomplishments in modern state government history," said Rep. Mike Osburn, R-Edmond, a member of the LOFT oversight committee. "In our term-limited system that leaves legislators with so much to learn in such little time, LOFT has really closed a learning gap for legislators, and the result is better policy for Oklahoma." In addition to its reporting functions, LOFT has presented independent information at four interim studies on the topics of COVID learning loss, best practices of peer state parks, comparative analysis of state-funded health insurance benefits and, as a follow-up to its report on County Improvements for Roads and Bridges (CIRB), estimating elimination of structurally deficient county bridges. LOFT also provides member assistance and additional research for bills directly related to a LOFT report. "For decades, the Legislature gave agencies tax dollars but had no mechanism to regularly evaluate the effectiveness of those investments. With the independent, credible information LOFT is now providing, Oklahoma can make much more effective use of taxpayer resources," McCall said. Video FOR IMMEDIATE RELEASE: Contact: Jeff Boatman Phone: (405) 557-7341 Contact: Rep. Mike Osburn Phone: (405) 557-7360 -END-
Members of the Legislative Oversight Committee today approved the workplan for the newly created Legislative Office of Fiscal Transparency. The plan maps out a schedule for in-depth, data-driven evaluation of specific programs and processes of state agencies to ensure Oklahoma taxpayer funds are used efficiently and effectively.
“LOFT has the potential to examine state agencies both in fiscal and performance reviews for the sole purpose to make sure taxpayer dollars are being efficiently and effectively spent to serve the citizens of Oklahoma,” said Sen. Roger Thompson, who serves as co-chair of the Oversight Committee. “I am looking forward to the data produced by LOFT as we craft future budgets for Oklahoma.”
Co-Chair Rep. Kevin Wallace said, “Approving this workplan was a historic first step toward state budgets based on better data, a deeper understanding of where taxpayer dollars go, and what the taxpayers are getting in return for their investment. I appreciate the hard work the LOFT staff has done to date and look forward to the results they will bring legislators in the future.”
While review of all programs and expenditures are within the scope of the agency, the office’s first work plan focuses on gathering and analyzing operations and expenditures of some of the largest agencies and programs to determine how well resources are being used to fulfil the core missions of the entities. Approval from the Legislative Oversight Committee now allows LOFT staff to begin the data gathering and analysis process for rapid response evaluations and other priorities as identified by the Committee. A copy of the LOFT workplan is available at http://www.okloft.gov/Workplan.pdf
LOFT has statutory authority to examine and evaluate the finances and operations of all departments, agencies and institutions of Oklahoma and all its political subdivisions. LOFT’s mission is to assist the Oklahoma Legislature in making informed, data-driven decisions that will serve the citizens of Oklahoma by ensuring accountability in state government, efficient use of resources, and effective programs and services.
Created in 2019, LOFT is overseen by a 14-member Legislative Oversight Committee, appointed by the Speaker of the House and the Senate Pro Tempore.
FOR IMMEDIATE RELEASE
Contact: Regina Birchum
Legislative Office of Fiscal Transparency
Capitol: (405) 724-7760