Opinion ID: 2571613
Heading Depth: 1
Heading Rank: 3

Heading: The Legislative Bond Oversight Commission

Text: ¶ 14 In 1987, our Legislature determined there was a need to reform current procedures regarding the issuance and sale of bonds or other obligations by state entities which are essential to the state's economic well-being and enacted the Oklahoma Bond Oversight and Reform Act. [11] 62 O.S.2001, §§ 695.1, et seq. Since enactment of the bond oversight legislation, no state governmental entity may issue any obligations unless such obligations have been approved by the EBOC and the LBOC. 62 O.S.2001, § 695.9. Although not specifically referenced in the highway improvement and expansion plan, LBOC approval of the proposed ODOT grant anticipation notes is required. ¶ 15 The composition of the LBOC is outlined in 62 O.S.2001, § 695.4. The statute simply provides that the Speaker of the House of Representatives and the President Pro Tempore of the Senate shall appoint three members each to the six-member LBOC. The original version of the statute required the appointment of specific committee chairpersons from the Oklahoma Senate and House of Representatives. [12] While the current version of the statute does not require the Speaker and Pro Tempore to appoint legislators to the LBOC, all current members appointed to the commission are legislators. ¶ 16 In examining whether LBOC approval of obligations to be issued by a state entity violates the separation of powers doctrine, we turn to the factors enunciated in Bennett. In the instant controversy, the LBOC approved grant anticipation notes after the Transportation Commission authorized the ODOT to issue the notes. In approving the notes, the LBOC exercised a power that cannot be classified as purely legislative, because it is beyond the Legislature's fundamental role to make the law. While the power may be tangentially related to the Legislature's control over fiscal matters, its dominant aspect involves carrying out legislative policy and applying it to varying conditions. J. Brotton Corp. v. Oklahoma Alcoholic Beverage Laws Enforcement Comm'n, 1991 OK 126, 822 P.2d 683, 685-6. In other words, the LBOC consists of individual legislators exercising powers that are primarily executive or administrative. ¶ 17 In evaluating the degree of control exercised by the commission, we note that it consists entirely of sitting legislators. No executive officer sits on the LBOC to control the power or effect that the six legislators have on this vital phase of the approval process. These six legislators can halt the entire issuance of the grant anticipation notes even if the executive branch desires to move their approval. 62 O.S.2001, § 695.9. Accordingly, the LBOC is a vehicle by which the executive department is being subjected to the coercive influence of the legislative department. ¶ 18 The question of legislative intent is closely linked to the issue of legislative control, but looks more closely at the Legislature's actual motives. In evaluating the motive of the Kansas Legislature in creating a state finance council, the Bennett court considered whether there was some legislative intent to cooperate, such as providing some special expertise of one or more of its members or if the legislature's efforts seemed to be more a matter of establishing superiority. Id. at 798. Section 695.4, creating the LBOC, contains no requirement that its appointees possess any expertise, knowledge or skill valuable in evaluating bonds or anticipation notes. In contrast, the Oklahoma State Bond Advisor, who is jointly engaged by the EBOC and the LBOC, must be knowledgeable in the current state of the art of national and international standards for the issuance of obligations by governmental entities[.] 62 O.S.2001, § 695.7(A). ¶ 19 The absence of any statutory language addressing the qualifications of those appointed to serve on the LBOC combined with the exclusive legislative make-up of the LBOC, results in a situation ideal for implementing legislative superiority and control over the approval process itself. While we cannot be certain this was the Legislature's motive, it is the effect achieved. Although the statute allows the Legislature the flexibility to appoint non-legislators to the LBOC, it has appointed a commission composed exclusively of legislators. This evinces a motive to retain legislative control over the note-approval process. ¶ 20 Bennett suggests that the reviewing court also examine the practical effect of the blending of powers as shown by actual experience over a period of time where such evidence is available. The record before us does not reveal the historical experience of this blending of powers over time and accordingly this factor is not significant in our analysis. ¶ 21 Our analysis leads us to conclude that the power wielded by the six legislative members of the LBOC is potentially coercive and may constitute a significant interference with the executive branch in the note-approval process. The LBOC, as composed, is effectively a mini-legislature implanted in the note-approval process. We find that the challenged arrangement, the approval of the LBOC in the note-approval process, constitutes a usurpation by the Legislature of the powers of the executive branch and violates Oklahoma's constitutional separation of powers provision.