Pass-Through Money Benefits Many Groups

Jerry Bohnen
Contributing Editor

While Oklahoma City attorney Andrew Karim has written to top state leaders demanding the recovery of $2 million in state money given to the Youth Expo livestock show, some lawmakers point out there are dozens of other groups getting the same kind of pass-through money.

They are lawmakers who support the lawsuit filed in September challenging the Oklahoma Agriculture Department’s $2 million pass-through funding of the Oklahoma Youth Expo. And they say they’ve found nearly 40 other groups getting nearly $11 million in state money without providing any accountability.

The lawsuit was filed in Oklahoma County District Court by Representatives Mike Reynolds, a Republican from Oklahoma City and Mike Ritze, a Republican from Broken Arrow.  They contend the pass-through funding of the Youth Expo is a violation of the Oklahoma Constitution.

So does Rep. Paul Wesselhoft, a Republican from Moore.  He supports the lawsuit and was asked to join in the filing, but Wesselhoft said he declined for personal reasons. Representative Sallly Kern, another Republican from Oklahoma City supports the suit too, but like Wesselhoft, declined to put her name in the suit because of personal reasons which she declined to discuss.

“I do support the suit,” said Kern. “The issue needs to be addressed.”  After sitting through a lengthy meeting with an attorney who explained the issues, Kern said she was not comfortable in joining the suit.

Rep. Wesselhoft provided a list of at least 40 other groups like the Youth Expo that also get the pass-through funding that was arranged by what he called powerful legislators.  “These are non-profits but not a single one appears on the budget.” He said he’s met with more than a dozen legislators who were unaware of the pass-through funding and ‘were shocked.’ “The constitution is very clear. We do not give tax moneys to non-profits. But they get around it by calling it a pass through.”

Wesselhoft has no doubt that most of the entities getting state funds are good organizations. “But this is not a fair system. There are all kinds of non-profits, so why aren’t they included?”  He rattled off a list of groups such as the Tulsa State Fair that is getting $85,000, the Rural Enterprise Institute in Durant that’s getting $460,000 in the coming year, or the $800,000 for BRAC Protection of cities and communities surrounding military bases. The State Historical Society’s giving $50,000 for renovation activities at the National Wrestling Hall of Fame in Stillwater. The Jenks Aquarium is getting $40,000 from the State Department of Tourism and Recreation. The same department is giving $25,000 to the Red Earth Indian festival in Oklahoma City. The International Pro Rodeo Association’s finals rodeo is getting $25,000.

Two major sums include $2.3 million for the Community Expansion of Nutrition Assistance for low income individuals and families. The Commerce Department is also the pass through source for $2.1 million to improve Head Start Programs and expand enrollment.

Still others include $25,000 for the Clem McSpadden roping event, $25,000 for the Reining Horse show, $84,000 to promote Oklahoma grown food to be served in Oklahoma schools, and $300,000 to market Oklahoma produced and grown items to consumers in Oklahoma and surrounding states.

The Agriculture Department, under fire in the lawsuit, is also giving $54,000 to the Sunrise Agriculture News program, a project to help Career Tech operate the Oklahoma Horizon tv show.

But the Youth Expo funding is the main target of the lawsuit filed by attorney Andrew Karim who contends the pass-through funding is in violation of the state constitution.  “Court is the only place we can go to get a legal ruling whether this is constitutional.” However, this week he sent letters to Governor Mary Fallin and other state leaders, asking them to return the money. But Fallin, House Speaker Kris Steele, R-Shawnee and Senate Pro Tem Brian Bingman, R-Sapulpa defend the actions of the State Agriculture Department.

Karim still believes there are a number of grounds on which the lawsuit is viable. “It violates the public purpose doctrine of the state constitution,”said Karim in referring to the pass-through funding.  District Judge Barbara Swinton will hold a hearing later this month on motions filed by several state officials to have the suit dismissed. A hearing will be held November 29 at 1:30 p.m. on motions filed by State Treasurer Ken Miller, Secretary of State Glenn Coffee and Carol McFarland, the interim director of the Office of State Finance.

But there are other issues that accompany the legality of the pass through funding—namely, the lack of accountability of the groups that are getting the money. Once the money is passed through a state agency, there is no accounting on how the money is spent. It’s no longer state money and the expenditures do not fall under the Open Records law of Oklahoma.  Some years ago, reporters attempted to learn how the Rural Enterprise Institute in Durant was spending the money it received from the Commerce Department. But REI refused to open its books because it is not a public entity, even though it receives public funds.  Many of the other 40 or so entities are the same.  Unless they happen to be a state program, their records are private and it would be impossible to verify how the money was spent.