Newspaper article THE JOURNAL RECORD
Attorney General Calls Panel Unconstitutional
The opinion, which is only advisory and not binding, was in response to a request by State Rep. Ernest J. Istook, R-Warr Acres.
The Legislative Bond Oversight Commission, along with the Executive Bond Oversight Commission, was created by House Bill 1444, the Economic Recovery Act of 1987. A quorum of both commissions is necessary for approval of financing under the Credit Enhancement Reserve Fund, also created by the Economic Recovery Act.
Credit-enhanced loans are initially approved by the Oklahoma Development Finance Authority, and bond commission approval is the final step in the process. The credit enhancement fund is a state guarantee of the loans, which would be fulfilled by a general obligation bond issue in the case of default by a borrower.
Tom Spencer, assistant attorney general who is the lawyer for both bond commissions, said the opinion released Tuesday is strictly advisory and should not affect prior or future loan approvals.
The opinion could, however, prompt a court challenge of the legislative commission or inspire Oklahoma lawmakers to change the law, Spencer said.
Crafters of House Bill 1444 foresaw the possibility of a challenge to the legislative commission, and the bill provides a back-up oversight council should the legislative commission be declared unconstitutional in a court of law.
Spencer said a potential problem with that council lies in the fact that it would also have legislative appointees.
The statute enacted from House Bill 1444 says that the executive and legislative bond oversight commissions must stand together, and the abolishment of one would mean the abolishment of both, according to Spencer. …