Oklahoma Budget Problems Persist

So here we are once again in a state budget mess as time begins to wind down in the legislative session and, faced with a $878 million budget shortfall for next fiscal year, lawmakers and stakeholders have starting offering up proposals.

On one side of the proposals, a group of supporters are suggesting the state raise the oil and gas production tax back to its historic level and increase income taxes on the wealthiest Oklahomans. This could put a dent in the shortfall

On another side, there are proposals to tax more services and raise taxes on cigarettes and fuel, which would help the financial situation somewhat and could lead to teacher raises but would hardly solve the problem. Some people see these as regressive taxes, as well, because people with less income pay more of a percentage of their income for the essentials of life. One can argue whether cigarettes are “essential,” of course.

Then there’s The Oklahoman editorial board, which recently warned “ . . . if lawmakers raise taxes on oil and gas production and cause curtailment of drilling, they could quickly turn the current state recovery back into a recession.”

In the end, funding cuts seem to be a given once again this coming year.

So we’re stuck in a dire situation. Oklahoma, it has been noted repeatedly, has cut education the most on a percentage basis than any other state since 2008. Teachers haven’t had an across-the-board raise in years, and many are flocking to other states for better pay and support.

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Where Is The Money For Teacher Raises?

Oklahoma legislators have apparently yet to come to an agreement on how they plan to fund proposed teacher raises and with their session scheduled to end in about a month that’s not an encouraging sign.

NewsOK.com reported that the Oklahoma Senate has not scheduled a hearing on a proposed House bill that would raise teacher salaries by $6,000 spread out over three years. This means it missed a Thursday deadline, although by rule it could still be worked out by the Joint Committee on Appropriations and Budget, according to the NewsOK.com article.

The Oklahoma Legislature, at least in recent years, has been noted for bringing up companion legislation and passing budget deals at the very end of the session, which is a practice that sometimes gives little time for public input on crucial matters impacting the state.

The teacher pay raise, which is a crucial matter given that some teachers here are flocking to other states for better salaries, has been endorsed by a number of Republicans in the GOP-dominated legislature and Gov. Mary Fallin. The sticking point, of course, is that the state faces an $878 million budget shortfall for next fiscal year. How will the raises be funded?

The lack of an agreement on a funding plan may well mean at least some legislators want to be perceived as trying to fight for teacher raises when, in fact, they know that given the dire budget situation there’s no way any significant increase is possible.They want to have it both ways. Even a nominal raise would help, but committing the state to a three-year, $6,000 teacher pay increase without significant tax hikes or additional revenue streams would mean drastic cuts elsewhere in the budget.

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Will Smokers Help Dire Oklahoma Budget Situation?

I don’t necessarily see anything wrong about raising the state’s cigarette tax by $1.50 a pack, but the legislative effort to pass it again shows how Oklahoma is still dependent on small fixes to help shore up its budget.

The proposed tax increase would generate around $184 million the first year in a budget of approximately $7 billion, and some $50 million of that would go to the Department of Mental Health and Substance Abuse Services, which is a good thing. With additional matching federal funding for health programs the amount of money the tax would generate has the potential to increase incrementally.

The problem though is that part of the mission of the tax is to get people to stop smoking so, if that happened, fewer smokers would mean declining revenue. It’s a tax that seeks its own demise.

In addition, those of us that don’t smoke won’t contribute at all, and smokers would pay a steeper price for their habit. The tax is regressive in that lower-income people, if they smoke, spend more of a percentage proportion of their money for cigarettes. I understand why smokers would oppose the cigarette tax and feel singled out, but the evidence is clear that long-term smoking can and does lead to severe illnesses, such as cancer and emphysema. The nicotine contained in cigarettes is also a highly addictive drug, and it’s difficult to quit. The tax is regressive, but it’s also a public health issue in terms of the overall medical costs to our society.

So it’s a debatable issue with no real answer. Do people have the right to smoke? Of course. But how much of that right infringes on other people in terms of its health costs to our society? This question will never be resolved to everyone’s satisfaction, and we know people will continue to smoke in the foreseeable future.

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