Obvious Decision: Court Throws Out Tax Cut Bill

Image of Oklahoma State Capitol

The Oklahoma Supreme Court decision Tuesday to throw out last year’s legislative tax cut and Capitol building repairs bill seems so obvious, so fait accompli, that one wonders if Republicans actually planned it this way.

The court decided House Bill 2032, passed last session, was unconstitutional since it violated the rule that legislation must be limited to a single subject. The bill would have cut income taxes from 5.25 percent to 5 percent starting Jan. 1, 2015, with additional cuts if revenues met certain expectations in coming years, while providing $60 million in repairs to the dilapidated state Capitol building.

Income tax cuts. Repairs to an aging building. No matter what one thinks about political logrolling, which is the practice of putting more than one subject in a legislative bill in order to get it passed, it seems clear then and now that HB 2032 was in violation of the state’s constitution.

Here are three speculative reasons for how all this transpired:

Poison pill. As I’ve written before, Republican leaders might have added the Capitol repairs to the income tax bill as a poison pill because they actually didn’t want tax cuts. Oklahoma’s schools have seen their funding drop by more than 22 percent since the Great Recession, and the majority of state workers have gone without a raise for seven years. Tax cuts fit the Republican ideology, but in reality they are terribly wrong for Oklahoma right now. The poison pill or knowing the court would eventually throw out the legislation allows Republicans to save face. They can say they at least tried to pass a tax cut.

Activist Judges. This one might be more of a stretch, but Republicans often complain of “activist judges” when a court ruling doesn’t fit with their ideology. It’s a standard GOP talking point. Could it be that Republicans actually set up this scenario so they could later rant about the legal system and push for electing state appellate judges and justices? Some Republican leaders want term limits for justices, too. This all might seem too involved, but it’s possible, and it overlaps with the poison pill speculation. At least, the GOP can try to score some political points with a bill they knew wasn’t going to stand up to a legal challenge.

Just plain miscalculation. Did Republican leaders really think that providing for tax cuts and building repairs in one bill didn’t violate the single subject rule? That seems unlikely to me. If so, then, well, I don’t know how else to put it, but it seems like a major miscalculation, and some might even say it was not the smartest move ever by the GOP here, which dominates state government right now. Perhaps, it was just a type of “hail Mary” political move to get Republican compromise on the bill, but it still doesn’t add up.

In response to the court’s decision, David Blatt, executive director of the Oklahoma Policy Institute, said:

The Supreme Court's decision to strike down misguided income tax cuts offers lawmakers a much needed lifeline to get our budget back into balance. In recent months, it has become more clear that another tax cut is the wrong priority when state revenues are not meeting projections, the state share of health costs is growing, prisons remain critically understaffed, and education funding remains stuck far below 2008 levels. Lawmakers should use this chance to recognize that we can't maintain our prosperity without paying for the services that citizens and businesses need.

Perhaps, in the end, the court has saved the Republicans from themselves, and that’s good for the state. Still, the Capitol building is in desperate need of major repairs, which could be funded by a simple bond issue, and there’s always the next session for Republicans to get it wrong.