After slashing taxes, Okla. struggles to fund schools, other services

[GennGreymane]

http://www.bostonglobe.com/news/nati...?event=event25

OKLAHOMA CITY — Four years ago, Oklahoma’s oil patch was booming, unemployment was falling, and lawmakers were debating what to do with a $200 million surplus.

Republicans who control state government successfully pushed to reduce the top income tax rate, slash the oil and gas production tax rate from 7 percent to 2 percent, and give more tax incentives to industry.

But the boom ended, and the money dried up.

Now, the once-unwavering confidence in the wisdom of lower taxes has given way to a growing panic over how to pay for basic services, including schools, health care, and public safety. Revenue has fallen about 20 percent short of budgeted needs — for the third year in a row.

The situation has deteriorated to the point where Oklahoma Highway Patrol troopers have been warned not to fill their fuel tanks, and drunk drivers have been able to keep their licenses because there are not enough administrative workers to revoke their driving privileges. Nearly 100 of the state’s 513 school districts have moved to four-day weeks.

Oklahoma’s woes are intensifying just as President Trump’s administration proposes its own ambitious plan to slash corporate and personal taxes. The White House insists the overhaul will spur economic growth and bring prosperity to the middle class, but the idea alarms lawmakers worried about the risk of ballooning federal deficits.

State legislators have already tried cutting the budget. Overall, last year’s inflation-adjusted budget of $6.9 billion was 11 percent less than in 2009, according to a recent analysis.

But the spending cuts have not been enough to close a projected $900 million gap. Lawmakers are weighing drastic steps, such as reducing Medicaid payments, which officials say could cause hundreds of nursing homes to close.

‘‘We’re not running the state based on a plan and a strategy. We’re trying to operate it on a philosophy,’’ said State Auditor and Inspector Gary Jones, a former Oklahoma Republican Party chairman who’s among a growing number of Republicans and Democrats calling for an about-face. ‘‘It seems like we’re afraid to admit we’ve made mistakes and correct them.’’

It’s not clear that some in Oklahoma’s GOP are ready to see taxes as a two-way street. The party holds more than three-quarters of the Legislature’s seats.

‘‘I think we need to . . . make sure we’ve squeezed every nickel, dime, and penny out of every corner that we can before we just start raising taxes,’’ said Republican Mike Schulz, the Senate leader.

Oklahoma isn’t the only red state in tax-cut distress.

Lawmakers in GOP-led Kansas, Indiana, Missouri and Mississippi are debating ways of raising more revenue to ease budget problems. In neighboring Arkansas, where Republicans recently won control of the State House, GOP leaders approved a more modest tax cut proposal than many conservatives wanted.

It’s difficult to pinpoint whether a specific tax cut leads to economic growth, but lowering the tax burden can sometimes spur the economy, said Nicole Kaeding, an economist at the Tax Foundation, a Washington, D.C., research group.

She cited North Carolina as a state that cut individual and corporate tax rates while expanding the sales tax base.

However, she said, tax revenue ‘‘is just one side of the equation. If you just cut tax revenue but don’t cut spending, the state of course is going to have a budget issue.’’

Oklahoma’s situation is particularly dire because the state relies so heavily on the volatile oil and gas industry, which accounts for 13 percent of overall state revenue. Also, term limits regularly send a fresh crop of newly elected GOP officeholders to the State Capitol eager to redeem their campaign promises to lower taxes.

Schools, which receive half of state-appropriated funds, are feeling the brunt of the shortfall. The Tulsa district is proposing to close four schools and scrap some sports programs. The state and regional science fairs were listed for elimination until a private donor came forward with a $50,000 check. Teachers have not received a raise since 2008.

Many state agencies have had their budgets cut by 40 percent over the last three years.

When many red states cut taxes after Republicans made sweeping gains in the 2010 election, their leaders anticipated that any revenue loss would be temporary.

‘‘There’s been this persistent argument that if we cut taxes, the economy will grow enough to make up for the lost revenue, and it just simply doesn’t happen,’’ said economist Mickey Hepner, dean of the University of Central Oklahoma’s College of Business.

Republican Governor Mary Fallin stands by Oklahoma’s 2014 individual income tax cut, which eliminated $135 million in annual revenue. She is now calling for tax hikes on cigarettes, fuel, and a wide assortment of services to compensate.

‘‘I’ve given a lot of different solutions for our Legislature to consider,’’ she said. But no revenue proposals have advanced yet.

So far, Fallin and other Republicans have avoided paying a political price for the problems. Many lawmakers count on support from conservative voters who believe that government can always be smaller.

‘‘I think if we looked at any government agency, there’s fat that can be trimmed, and that includes the schools,’’ said Zane Grider, manager of a car dealership in Newcastle whose two kids now attend school just four days a week. ‘‘If we ran our business the way the government tries to run things, we’d all be broke.’’

Democrats say they believe many are growing weary of the annual budget crisis.

[chewie49]

Here's a crazy idea. Instead of using the 1700's Prussian model of school with class rooms and desks all lined up. Why not join the modern internet age and let kids who are able take classes online? It'd save the state and federal government from spending tons on buildings, buses, and faculty; and kids will be getting (likely) a better education. I know, I know..."But that's not the way we've always done things!", or, "But what about social interactions and sports?!" Well, as the that: those things are easily set up via local programs such as the YMCA or other organisations; you do know that home school groups exist and can be expanded, right?

[Kujako]

Here's a crazy idea. Instead of using the 1700's Prussian model of school with class rooms and desks all lined up. Why not join the modern internet age and let kids who are able take classes online?

Using what computers and which internet service? Who pays for those?

[Scottyjscizzle]

Using what computers and which internet service? Who pays for those?

If these liberal children want their so called "education" they can pull themselves up by their bootstraps, back in my day we hunted for lunch and learned from the good book!! /s

[bigsav1]

Using what computers and which internet service? Who pays for those?

The government is supposed to buy every person at birth a computer because of reasons brah.

[ati87]

Here's a crazy idea. Instead of using the 1700's Prussian model of school with class rooms and desks all lined up. Why not join the modern internet age and let kids who are able take classes online? It'd save the state and federal government from spending tons on buildings, buses, and faculty; and kids will be getting (likely) a better education. I know, I know..."But that's not the way we've always done things!", or, "But what about social interactions and sports?!" Well, as the that: those things are easily set up via local programs such as the YMCA or other organisations; you do know that home school groups exist and can be expanded, right?

I hope you're just being sarcastic, it's hard to tell in this age.

Other then that, who would have though that slashing taxes for the very rich specifically doesn't society in general. Who could have known that economy and taxes where so complicated!

WHo?

Every god dam 14 year old who just learned the basic principles of supply and god dam demand.

[Gorsameth]

If only someone would have told them that trickle down economics has been proven to not work.

Sadly it has never been tried before and these brave Republican states had to find out for themselves how great it is...

[Taneras]

Dropping energy prices is causing most of this. Louisiana is going through something similar and we've been increasing taxes on this end.

[GennGreymane]

Dropping energy prices is causing most of this. Louisiana is going through something similar and we've been increasing taxes on this end.

Welcome to the oil curse

[Sunseeker]

No one is too big to fail, right?

Let them fail.

This guy knows what's up.

Maybe, but Oklahoma is "right here" in a political sense. It's a fairly bad idea to let even a psuedo-nation fail, because we all know the people in power are going to walk out of there scott free. Noone's going to jail them for fucking up their state, and they'll just buy a home in a different state and probably run for office there.

But there are 3.9 million people in Oklahoma and letting the whole state collapse is essentially asking to create a internal refugee crisis.

[Queen of Hamsters]

Color me shocked that a society which hates the thought of paying "for others" (read; A functioning society) and values selfishness over the greater good, has made decisions accordingly...

[s_bushido]

I understand conservatives despise education, but I wonder if these numbnuts realize that it's not the over-privileged blue-haired protest-happy college students that they're fucking over with this. But hey, if kids never make it to college in the first place, I suppose they won't have the opportunity to be assimilated into the SJW collective.

[Sunseeker]

I don't expect anyone to go to jail, nor is that the point.

Then the point is what, exactly? If you know that nobody is going to punish the people responsible and the only people who will ultimately bear this burden is everyone else, what exactly, is the point of letting them fail, since you didn't actually state why this is a good idea to begin with?

[Travis B]

Republicans who control state government successfully pushed to reduce the top income tax rate, slash the oil and gas production tax rate from 7 percent to 2 percent, and give more tax incentives to industry.

But the boom ended, and the money dried up.

Not to worry, all that money that the richest people in the state got from the tax cut will eventually "trickle" its way down to the common people.

[Rumred]

I have lived in Oklahoma all of my life and most here knew this would happen. Its not so much the tax cuts that isn't as big of a issue. The issue has always been and will countinue to be the states economy lives and dies on oil and natural gas. I am mostly conservative but i have a fairly unpopular view on how to start to solve this problem. Oklahoma has alot of unused land held by families who have owned it for generations. They might use 10% of it for farming or other things if that many of them. I think Oklahoma should go the route of Texas and bump up property taxes in a effort to to get these people to sale their excess land to development alot of which its along the major interstates of our state 35 and 40.

Ideally this with other insensitive s to develop on the newly bought land would allow development. This would attract people to come to Oklahoma and encourage people to stay. This would hopefully lessen the dependence on the oil and gas industry for the states economy. This will have to happen sooner or later and i am of the mindset do it now before we either A run out of Oil and Gas in the state or B alternative sources make them drop in value even more. It might be a unpopular view in the state but its a idea i think could work.

Edit: To clear up alot of the land i was talking about many cases the family doesnt even live on it they just own it and do nothing with it or maybe have 5 cows for 200 acres.

[Acidbaron]

Here's a crazy idea. Instead of using the 1700's Prussian model of school with class rooms and desks all lined up. Why not join the modern internet age and let kids who are able take classes online? It'd save the state and federal government from spending tons on buildings, buses, and faculty; and kids will be getting (likely) a better education. I know, I know..."But that's not the way we've always done things!", or, "But what about social interactions and sports?!" Well, as the that: those things are easily set up via local programs such as the YMCA or other organisations; you do know that home school groups exist and can be expanded, right?

Even in nations where they get good results with teaching online such as South Korea it is used as a supplement not a replacement to the school system. You also assume that every child would have a study or a place that allows them to concentrating in peace. The west is filled with parents who's kids are diagnosed with all sort of attention disorders that's another thing working against it and internet and a decent computer is still not something every family has, especially with cellphones and tablets becoming the replacement "toy" to have around in the house.

[Exeris]

I'm curious are there any states that have some kind of saving for a rainy day practice like for example investing surplus into something that gives a steady income?

If so how are these states doing and what political party is running them?

[melodramocracy]

Math is hard, dumbfuck republicants.