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Hear Governor Fallin's State of the State

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State Impact-Oklahoma
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For the sixth time, Mary Fallin goes before a joint session of the Oklahoma Legislature to address the State of the State.

Oklahoma Gov. Mary Fallin on Monday proposed increasing the cigarette tax and expanding the sales tax to a variety of services that are currently exempt as a way to close an estimated $900 million hole in next year's budget.

Fallin delivered her State of the State address to lawmakers on the first day of the 2016 legislative session, along with her proposal for a balanced budget for the fiscal year that begins July 1.

"Even in this fiscal climate, we can pass a budget that begins the type of meaningful fiscal reform the state needs," Fallin said.

The Legislature is grappling with a hole in the budget of about $900 million, or about 13 percent less than lawmakers appropriated last year for education, transportation and other state services.Gov. Mary Fallin is proposing a new $120 million bond issue to repair and renovate Oklahoma's nearly 100-year-old state Capitol.

Two years ago, state lawmakers approved a $120 million bond issue to repair the Capitol. Fallin says the bond money helped builders launch the project but that contractors have said they think it will take another $120 million to complete the work. Fallin says interest rates remain low and the new bond wouldn't be issued until 2018, when 40 percent of the state's existing bond principal rolls off the books.

In December, officials chose Manhattan Construction and JE Dunn Construction to handle the project. Works includes new plumbing, electrical and mechanical system.

Gov. Mary Fallin is proposing $178 million for a permanent $3,000 pay raise for public school teachers in Oklahoma. She also wants lawmakers to consolidate the administrative costs of some schools.

A coalition of Oklahoma educators and civic leaders has proposed an initiative petition for a statewide vote on a new one-cent sales tax for public education to raise teacher salaries and address a chronic teacher shortage in the state. Fallin says her proposal would provide pay raises without raising taxes. Several lawmakers have proposed separate measures to raise teacher salaries without raising taxes.

Fallin says consolidating the administrative costs of the state's underperforming kindergarten through eighth grade dependent school districts would get more money to classrooms.

Gov. Mary Fallin is proposing an additional $11.3 million to the Oklahoma Department of Human Services to fully fund the state's plan for improving the state's foster care system for children.

The Pinnacle Plan was developed in 2012 as part of a settlement to a class-action civil rights lawsuit over the treatment of children in state custody. Fallin says it's important to maintain the state's commitment for the sake of the thousands of Oklahoma foster children.

Last year, Fallin launched an initiative called Oklahoma Fosters that encourages people to foster or adopt children in state custody. The governor says the plan's working.

Gov. Mary Fallin is calling for changes to sentencing guidelines aimed at reducing incarceration rates in the state.

Fallin says tough prison sentences for drug convictions haven't deterred substance abuse and have instead filled state prisons beyond their capacity.

She called on state lawmakers to lower Oklahoma's mandatory drug possession sentences and to allow district attorneys the discretion to file any first drug offense as a misdemeanor. Fallin says the penalty for first-time offenders should be lowered from two to 10 years in prison to zero to five years.

For property crimes, Fallin says the value of a felony crime should be raised from $500 to $1,000.

Gov. Mary Fallin is proposing a new tax on cigarettes to help close a more than $900 million hole in next year's state budget.

Fallin made the proposal Monday in her State of the State address to open the 2016 Oklahoma Legislature.

Fallin says the cigarette tax would raise $181.6 million a year. The governor says the state's smoking rate has dropped 19 percent since she took office in 2011, but one in five Oklahomans still smokes.

Fallin proposes raising another $729 million in other revenues, including $200 million a year by collecting sales taxes on some services that are now exempt. The governor also said the state can save $125 million a year by passing legislation that would automate reconciliation of some agency revolving funds and another $125 million from revenue collected by agencies that don't receive state appropriations.

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