During his governorship, Phillips was charged with accepting a bribe, was tried twice, but was eventually acquitted. Phillips was the first state representative to be elected as Governor of Oklahoma and his term was marked by his proposals to trim the state budget. Despite deep cuts, the budget produced by the 17th Oklahoma Legislature was not balanced; it was the last budget not subject to constitutional requirements to balance the budget approved by voters in 1941. Phillips was responsible for the constitutional amendment requiring a balanced budget of the Oklahoma Legislature.