OCPA Statement on OEA Demands

After the Oklahoma Education Association (OEA) released its demands, OCPA president Jonathan Small released the following statement:

“The OEA did not release a plan. Instead, the union, which represents a small percentage of Oklahoma teachers, released a set of demands with a total cost of $3.3 billion over three years. And, less than half of that money would go to teachers.

“The annual cost of the OEA’s demands, by year three, would be $1.4 billion. This is larger than any revenue package seriously considered by the Legislature in recent years.

“Teachers need a raise, just like our schools need reforms, but the goal should always be to improve student outcomes. That, obviously, is not served by a strike. And recent reporting in the Tulsa World suggests that many teachers are far more concerned about working conditions than they are about money. The OEA wants a narrow conversation about money, but the union’s own recent polling shows most Oklahomans are concerned about “accountability” (62%) and “personal responsibility” (39%) more than “investment” (27%).

“The Legislature should pass a teacher raise, coupled with reforms that put more control over pay in the hands of local districts. And there are many ways to give teachers a raise without increasing their taxes. If lawmakers are set on raising taxes to fund a teacher pay raise, we urge them to focus on the least damaging tax increases: increasing from two percent to five percent the gross production tax (during the incentive period) and a 75 cent per pack cigarette tax.

“Efficiencies and reforms include eliminating cash subsidies for wind and other renewable energy generation, cutting fraud in Medicaid, eliminating subsidies to filmmakers, and reforming the Commissioners of the Land Office and Tobacco Settlement Endowment Trust (which together control funds worth more than $3.5 billion) to direct some of their existing resources to teachers.”

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AFP Co-Hosts 2018 Growth and Opportunity Summit in Tulsa Saturday
Dr. Tom Coburn to headline conference

TULSA, Okla.—The 2018 Growth and Opportunity (GO) Summit is coming to Tulsa this Saturday, Feb. 24 at the DoubleTree Hotel in South Tulsa. The event will be headlined by a keynote address from former U.S. Senator Dr. Tom Coburn.

“We are thrilled to have Dr. Coburn address this year’s Growth and Opportunity Summit,” said. AFP-OK State Director John Tidwell. “Things are moving quickly at the State Capitol and the GO Summit provides an opportunity for citizens and voters to learn more about what the state legislature is up to and how they can impact lawmakers when they engage on issues.”

Among other learning opportunities available at the GO Summit, Oklahoma Council on Public Affairs Executive Vice President Trent England will give a lunch presentation on the Oklahoma Constitution, the longest state constitution in the country, and how the state can follow the law and best serve taxpayers. Rounding out the day will be a legislative roundtable with current members of the state legislature on the state budget “crisis” and what comes next for our state budget after the failure of the Step Up plan.

In between speakers will be breakout sessions that will provide a more detailed picture of issues that are being talked about at our State Capitol. These breakout sessions include:

• Hollywood Handouts: Even in Oklahoma Hollywood is gobbling up tax credits. Where is the money going and what to we do about it?
• Fact or Fiction: The Oklahoma Budget
• Occupational Licensing 101: I need a license to do that?
• Impacting your legislator: How to cut through the clutter and best communicate with your legislator.
• Healthcare and Medicaid Reforms: How we can audit and right size our system through common sense reforms.
• Inside the Oklahoma Education Funding Formula: What goes into the formula, what comes out and all the nonsense in-between.

The 2018 Growth and Opportunity Summit is presented by Americans For Prosperity-OK, Oklahoma Council on Public Affairs and Tulsa 912. For more information or to register for the conference please visit okgrowthsummit.com. Registration will also be available the day of the event.

FOR IMMEDIATE RELEASE

OCPA offers ‘a plan that can pass’

OKLAHOMA CITY (Feb. 12, 2018) — On Monday, the Oklahoma Council of Public Affairs (OCPA) offered a revenue plan in hopes of breaking the tax-and-budget impasse at the state Capitol.

“Oklahomans want to see teachers receive a $5,000 pay raise, but they know this can be done without unnecessarily heavy tax increases on working families and small businesses,” OCPA chairman Larry Parman said.

“Many people have asked OCPA for, in their words, ‘a plan that can pass,’ something that doesn’t raise taxes on working families, something simple that doesn’t require lawmakers to go through much gnashing of teeth from state government bureaucrats and tax consumers, but that still funds a $5,000 teacher pay raise and prevents nursing homes and other critical services from going under.”

OCPA’s “plan that can pass” includes:

– A gross production tax increase to 5 percent for existing wells taxed at 2 percent and for all future wells for 36 months, and 7 percent thereafter—$199.5 million in new annual revenue

– A $0.75 per pack cigarette tax increase—$121.9 million in new annual revenue

– A cap of $10 million on the zero-emission tax credit for wind—$60 million in new annual available revenue

– Send to Oklahoma voters a ballot measure dedicating all new tobacco settlement payments that currently go to the Tobacco Settlement Endowment Trust (TSET) to the state’s Medicaid budget—$57 million in new annual revenue

– Tribes in Oklahoma step up and decline to accept any future rebates from the state for the sale of cigarettes and tobacco products—at least $67 million in new annual revenue

The OCPA plan provides the revenue necessary—$505.4 million annually—to address a $5,000 pay raise for every classroom teacher in Oklahoma public schools statewide.

“It’s time to give teachers the pay raise they deserve and provide the funding for it and stop the rest of the bureaucracy from using teachers as pawns while state agencies refuse to reform,” OCPA president Jonathan Small said. “This plan, once passed, would make revenues available within 90 days. We believe this plan is the fastest way to get our teachers the raise they deserve.”

A close reading of Gov. Mary Fallin’s Fiscal Year 2019 budget, released last week, reveals that the gap between base agency appropriations and estimated certified revenue has been completely eliminated. Gov. Fallin’s budget also indicates that recurring certified revenue exceeds last year’s recurring appropriations by $59 million.

Small said that with the budget deficit now resolved for Oklahoma’s state government, it’s time to focus on a narrowly tailored package that solves the teacher pay raise challenge and doesn’t include cumbersome, damaging tax increases on working Oklahoma families.

“We acknowledge there is not currently the political will at the state Capitol to enact targeted reform of nonessential spending or to rein in the mismanagement that has taken place at state agencies like the Health Department, the Health Care Authority, and elsewhere,” Small said.

Small added that several proposals from state lawmakers this legislative session should also be approved to ensure that existing taxpayer resources are directed to areas of highest priority.

“Each legislative session should be devoted to reforming government and exploring the expenditure of every penny paid in by taxpayers,” Small said. “Unfortunately, this hasn’t happened.”

A few such proposals under consideration in the current session include:

-A proposal to dedicate Commissioners of the Land Office funds for salary increases for teachers and other public-school personnel

-A proposal to place on the 2018 ballot a measure allowing public schools to utilize a larger percentage of ad valorem funds for teacher and staff compensation and other classroom-related expenditures, as opposed to being restricted to facility and technology upgrades

-A proposal to institute more thorough and frequent eligibility audits of the state’s Medicaid rolls, as has recently been done in Arkansas

-A proposal to model successful reforms in other states by implementing work requirements for able-bodied adults to empower them and protect Oklahoma’s exploding Medicaid program for the most vulnerable

-A proposal to end Oklahoma’s Hollywood film credit subsidy, which paid $4.6 million to Harvey Weinstein

Parman also called for a return to oversight and responsible governance.

“This plan solves the state government problem with which there is consensus and allows for a clean slate for the rest of special session and the regular session to focus on structurally reforming and transforming Oklahoma’s structurally flawed government,” Parman said. “It is a violation of the Oklahoma Standard for policymakers and government personnel to neglect their number one responsibility which is to responsibly govern and protect the most vulnerable and taxpayers.”

“Not another penny in tax increases after this package passes should be considered at least until all of Oklahoma’s top twenty appropriated agencies have thorough financial audits, thorough performance and process improvement audits, and government personnel employment structures are reformed.”

Statement from Dr. Tom Coburn:
“For nearly eight years now, the executive branch, the bureaucracy, special interests, and even some legislators have predominantly been obsessed with trying to figure out how to get more revenue out of Oklahomans or expand government’s spending role in Oklahomans’ lives. They have thwarted efforts to truly transform government so it works better with less—and now are insisting on either tax increases or even more dysfunctional government.

“Because of their false choices, and the accompanying deterioration, teachers, the most vulnerable, working Oklahomans, and small businesses are being held captive and will suffer damaging tax increases that will harm families and ruin future efforts for pro-growth tax reform.

“To prevent that damage from occurring, this proposal by OCPA provides the best way, given the unfortunate circumstances, to give hardworking teachers the pay raise they have earned, protect the most vulnerable, and protect working Oklahomans and small businesses from damaging tax increases.

“It’s time for the circus to end. This narrowly tailored package proposed by OCPA will prioritize what’s important. It’s time for politicians to do their number one job which is tough and accountable oversight. It’s a violation of the Oklahoma Standard to raise taxes on the most vulnerable, working Oklahomans and small businesses when fraud and mismanagement is occurring at the Oklahoma Health Department, the state Medicaid budget is out of control and scores of opportunities for efficiency and savings are avoided. It’s time for politicians to do the tough work of responsible fiscal governance, structural reform and transformational policy solutions that end income the failed status quo of government operation — as promised.”

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OKLAHOMA CITY – Use of state education resources are being questioned amid findings that public school spending is nearing an all-time high. Public education revenues have risen from $7.40 billion in 2006 to $8.79 billion in 2016 fueled largely by increases in local revenue sources rather than state appropriations, according to public records.

Experts see confusion caused by people talking about revenues interchangeably with appropriations.

“But even appropriations are pretty stable,” said Curtis Shelton, policy research fellow for the Oklahoma Council of Public Affairs.

So where is all the money going? Analysts say that school administrators are wasting money on special programs and “non-teachers.”

A report by Dr. Benjamin Scafidi, professor of economics at Kennesaw State University, recently showed Oklahoma now employs more non-teaching personnel than teachers, as Shelton pointed out.

Jonathan Small, president of OCPA, observed, “We could have already given every public school teacher in Oklahoma a $7,042 raise if we had simply increased our non-teaching staff growth at the same rate as our student enrollment growth.”

Using the data that the Oklahoma State Department of Education reports to the U.S. Department of Education, Scafidi found that between fiscal years 1993 and 2014 enrollment in Oklahoma public schools increased by 14 percent.

The number of teachers rose by a comparable 13 percent. But non-teaching school staffs soared a dramatic 34 percent.

“We’re actually quite a bit above average when it comes to non-teaching personnel,” Shelton said. “That’s a big area where the money is going.“

Public records show the average Oklahoma teacher’s compensation is $45,245 compared with a regional average of $48,103. The beginning teachers pay of $31,600 hasn’t been increased since 2008. That is the number that draws attention.

But public records show that nearly half of the state’s 41,047 teachers have taught 20 years or more, placing them at the upper end of the wage scale.

Another analyst more sharply criticized the way schools are run.
“We seem to be, compared with other states, misallocating resources,”said Byron Schlomach, director of the 1889 Institute, a conservative think tank.

“Public education is absolutely rife with waste,” he said. “It’s so corrupt that they don’t even know it. “All these superintendents, and these boards education, just got used to wasting resources. And I consider it a type of corruption.

“The kind of waste I’m talking about is kind of hard to put your finger on. It’s sort of ‘death by a thousand cuts’ kind of waste. They get hung up on ideologies rather than what works in the classroom. In my opinion, they have too many counselors for example. They have too many principals.”

Additionally, he said too much funding is being thrown at Pre-K and kindergarten programs. Oklahoma is only one of a handful of states that offers universal Pre-K.

“There is a lot going on in school funding…such that the system is being horribly gamed,” said Schlomach. “So, I have a hard time taking anybody seriously.”

He called the so-called teacher shortage “a red herring” or at most, “trivial.”

“I’ll know there is a teacher shortage when school administrators radically reorder how they use resources. When they start complaining, they’re not able to get their core mission accomplished. That’s when I’ll know there is a true teacher shortage.”

Gov. Mary Fallin recently issued an executive order directing the State Department of Education to determine a definition of administrative overhead in schools, and directing the department to identify high-administrative cost school districts with an eye towards consolidation.There are currently 513 school districts across the state, a number many consider excessive.

Fallin’s order is “way long overdue,” said Schlomach.

NOTE: Stacy Martin is an experienced, award-winning investigative journalist.
www.CapitolBeatOK.com

After the Tobacco Settlement Endowment Trust (TSET) Board of Directors voted Tuesday to provide funds for senior nutrition services at the Department of Human Services (DHS) and mobile mental health crisis teams for children through the Oklahoma Department of Mental Health and Substance Abuse Services (ODMHSAS), OCPA president Jonathan Small released the following statement:

“It’s encouraging to see TSET making healthier fiscal choices by shifting some spending back to its core mission of supporting the health of our most vulnerable citizens. I certainly hope this is a trend that continues. With more than $1 billion in the bank, investment earnings of about $40 million per year, and additional income of $50 million per year from the sale of cigarettes, it’s obvious TSET offers an opportunity to shore up core services.”

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It costs just $51.45 per person per day for the state of Oklahoma to fully fund all state share costs of a nursing home bed.

The Tobacco Settlement Endowment Trust spent $653,150 in fiscal years 2015 and 2016 on a project called Free The Night, which offers “promotional opportunities to smokefree bars and clubs.” That same $653,150 could have been used to fund 12,694 days for nursing home beds for Oklahoma’s most vulnerable.

Think about that number for just a moment. That’s 12,694 days for vulnerable Oklahoma grandmothers and grandfathers.

Shouldn’t TSET’s money and energy be refocused on things like critical health care, critical health and human services, or critical mental health and substance abuse services? Absolutely. In fact, some of TSET’s mandates include “Programs … designed to maintain or improve the health of Oklahomans” and “Programs designed to enhance the health and well-being of senior adults.”

TSET needs to be refocused on paying for core services to the most vulnerable Oklahomans, especially during tough economic times, rather than questionable grant programs and harassing Oklahomans about their personal lifestyle decisions aside from smoking. With more than $1 billion in the bank, investment earnings of about $40 million per year, and additional income of $50 million per year from the sale of cigarettes, it’s obvious TSET offers state leaders an opportunity to shore up core services.

Read the complete story on NewsOK.com

AS Oklahoma lawmakers grapple with budget shortfalls, many numbers have been tossed about. Yet some relevant figures have been mostly ignored. That’s starting to change.

In a recent letter to legislators, former U.S. Sen. Tom Coburn, former Gov. Frank Keating and former Secretary of State Larry Parman, all Republicans, pointed out that economic reality explains many state challenges.

Citing Oklahoma Tax Commission reports, the three noted that reported taxable income in Oklahoma plummeted more than $13 billion from 2014 to 2015. From the 2015 to 2016 state budget years, Oklahomans cut purchases subject to state sales and use tax by $4.1 billion.

Those who blame income tax cuts (primarily enacted in the 2005 and 2006 legislative sessions) for today’s financial problems are missing the big picture. When income falls by billions, the state will collect less in income tax, no matter what income tax rate is in place.

Read the complete story from the Oklahoman.

Dear Governor and State Lawmakers,

We are a coalition of conservative citizens, many of us serving in leadership of state or local organizations, who write to urge you to address the need for more consolidation and other efficiencies in all areas of state government and to resist raising taxes on your constituents.

Many Oklahoma families and businesses are struggling and have been forced to reduce their own spending. Indeed, Oklahomans lost more than $13 billion in taxable income and reduced purchases by $4.1 billion in one year alone when oil prices collapsed.

And yet, Oklahoma’s total state government spending is at an all-time high. The state is now on track to spend more money next year—more than $17.9 billion—than at any time in our history. If you believe that certain state services are not adequately funded, we urge you to prioritize spending rather than raise taxes.

“Limited government” and “lower taxes” have been winning campaign messages in Oklahoma over the last decade. Some candidates have even made written promises to oppose and vote against (or veto) “any and all efforts to increase taxes.” We encourage you to stay true to these principles and to oppose efforts to increase the burden of government on hard-working Oklahoma families.

Sincerely,

Jonathan Small
Oklahoma Council of Public Affairs (OCPA)

John Tidwell
Americans for Prosperity-Oklahoma

Grover Norquist
Americans for Tax Reform

Steve Curry
Republican National Committeeman for Oklahoma

Ronda Vuillemont-Smith
Tulsa 9.12 Project

Tom Newell
Former chairman, General Government Oversight and Accountability Committee, Oklahoma House of Representatives

Michael Bates
BatesLine.com

Brandon Arnold
National Taxpayers Union

Jamison Faught
MuskogeePolitico.com

Andrew Lopez
Canadian County Republican Party

Daniel Schneider
American Conservative Union

Charles W. Potts
Oklahoma Republican Party executive committee member

John Michener
Oklahoma Conservative Political Action Committee

Bunny Chambers
Eagle Forum of Oklahoma

Lisa B. Nelson
American Legislative Exchange Council (ALEC)

Ashley N. Varner
ALEC Action

Other signers will be added to the letter as the special legislative session continues.

After Gov. Mary Fallin announced her intention to convene a special session of the Oklahoma Legislature on Sept. 25, OCPA President Jonathan Small released the following statement:

“There is simply no need for a special session. For the fiscal health of Oklahoma, officials should look into moving funds already available instead of proposing hundreds of millions of dollars in new and damaging tax increases on hard-working Oklahoma families.

“If the executive branch is creative enough to completely drain our state’s constitutionally protected Rainy Day Fund for $240 million, then they are creative enough to allocate a portion of TSET’s $1 billion endowment. Doing so, along with using surplus revenues, would completely meet the cash flow needs of the agencies affected by the loss of cigarette tax money until February when the Legislature reconvenes.

“For the long-term fiscal health of Oklahoma, state officials need to focus on state spending. Oklahoma state government is now on track to spend more money next year—more than $17.6 billion—than at any time in state history. The simple truth is we don’t have a revenue problem; we have a spending and a transparency problem.

“Hard-working Oklahoma families and small businesses are already chafing from the constant demand of tax consumers. It would be destructive and repugnant for the Governor and the Legislature to come into special session—costing taxpayers around $30,000 per day—just so they can pass whichever tax increases Scott Inman deems best.”

OKLAHOMA CITY – Amid Oklahoma’s continued revenue dry spell, one politically conservative organization recommends tapping a long-established health care savings account.

Continued financial troubles have taken an ax to the state’s ability to pitch in for Medicaid. As the Oklahoma Health Care Authority’s budget continues to shrink, so does the federal match. That has resulted in reimbursement rates to nursing homes and hospitals falling to about half the national benchmark. The reduced rates have sent the medical providers’ margins dwindling. It has become common for them to operate at a loss. Several have already closed, and hundreds more face the same fate.

Instead of raising taxes, some conservatives are advocating for the Legislature to look to a tobacco-fueled medical trust fund to fill the holes.

After settling a lawsuit against some of the tobacco industry’s biggest players in the late 1990s, Oklahoma ended up with one of the country’s few constitutionally protected health care trusts. Almost all 50 states sued the companies, which ended up settling. Among the other provisions, they agreed to make annual payments to the states as long as cigarettes sold. The figures are based on national cigarette sales.

After the companies settled their lawsuits, some states took out hundreds of millions in bonds and implemented payback plans with the annual settlement money. Others created savings accounts statutorily, which allowed legislatures to come in and reappropriate the money during hard times. In 2000, Oklahoma approved a state question creating a constitutional amendment that protects the funding. The attorney general’s office gets a little more than 6 percent, and the Legislature gets about 19 percent. The rest goes into the Tobacco Endowment Settlement Trust, which is also known as TSET. Officials can use the principal only to invest, and they use the earnings on health-related programs. Initially, those focused solely on smoking cessation and prevention. Today, they include overall health promotion, cancer research, and residencies in rural hospitals.

Read the complete story on journalrecord.com

Rolling back ObamaCare’s Medicaid expansion has become the focal point of the health-care debate, and rightly so. Without fundamental change, Medicaid—expanded or not—will push state budgets to the brink even as it fails to help the most financially vulnerable Americans.

Consider Oklahoma, our home state. Despite intense lobbying by hospital corporations, the state Legislature stood strong and refused the Medicaid expansion. But the Medicaid rolls increased anyway, and at a dramatic cost to priorities like education, public safety and transportation.

Like most states, Oklahoma used to spend most of its funds on education. But a few years ago Medicaid’s rapidly rising costs pushed it to the top of the budget. Today, Oklahoma spends $5.1 billion a year on Medicaid, more than the $3.4 billion a year for K-12 schools and $942 million a year for higher education combined. Medicaid is now crowding out other state priorities, with real consequences in education and beyond: lower teacher pay, fewer textbooks, deferred road maintenance, fewer mental-health treatment options in the state justice system to prevent incarceration of nonviolent offenders, and—within the Medicaid program itself—lower reimbursement rates for doctors.

Something has to give. If policy makers want to preserve a functioning and reliable safety net for low-income citizens with serious health challenges, they must face the fact that Medicaid is failing.

Read the complete story on wsj.com

OCPA Releases Analysis, Critique of Standard & Poor’s (S&P) Recent Oklahoma Bond Rating Downgrade
Study finds that S&P’s recent downgrade of Oklahoma should be considered with a healthy degree of skepticism.

OKLAHOMA CITY—The Oklahoma Council of Public Affairs (OCPA) released today an analysis and critique of S&P’s recent downgrade of Oklahoma state government debt.

“Standard & Poor’s recent downgrade of Oklahoma should be met with a healthy degree of skepticism,” OCPA president Jonathan Small said. “S&P has a mixed track record of accuracy, objectivity, and impartiality in bond ratings.”

Earlier this year, S&P Global Ratings lowered its rating on the state of Oklahoma’s general obligation (GO) bonds and appropriation debt backed by the state’s credit enhancement reserve fund one notch to ‘AA’ from ‘AA+’. At the same time, S&P lowered the rating on the state’s appropriation debt to ‘AA-’ from ‘AA’.

“Although the lowered rating is something we should keep an eye on, it is not the end-of-the-world scenario that some bureaucrats and tax advocates want us to believe,” Small said. “These rating agencies have been incorrect in the past and, worse, they have been systematically biased.”

In the downgrade, S&P cites recent revenue shortfalls, which they categorize as “persistently weak revenue collections.”

“The implied remedy to ‘persistently weak revenue collections’ is simply raising taxes. It’s very suspicious when a rating agency downgrades your state and then proposes that all you need to do to fix it is raise taxes,” Small said. “Oklahomans deserve an honest conversation about taxes and spending; we don’t need a sky-is-falling lecture from S&P and tax consumers.”

Though S&P hits Oklahoma primarily for a revenue shortfall, 30 other states face a similar circumstance, according to data from the National Association of State Budget Officers (NASBO) and summarized by MultiState Associates.

“It’s bizarre for S&P to focus on Oklahoma’s revenue situation when shortfalls are part of a broader national trend in state revenue collections,” Small said. “This is important context to consider regarding S&P’s downgrade of Oklahoma and the state’s broader fiscal picture.”

OCPA’s study argues that rather than raise taxes on Oklahoma families and businesses, state policymakers would be wise to seek to bolster economic competitiveness, thereby boosting the underlying economy and enhancing future tax revenues.

The state’s economy has underperformed in recent years, particularly due to low energy prices depressing the state economy’s overall performance and thereby reducing tax revenues. The study points out that Oklahoma needs to diversify its economy by fostering substantive growth in industries outside the energy sector.

“It’s no secret that Oklahoma is hurting because Oklahomans are hurting. The downgrade has increased pressure to raise taxes in the state,” Small said. “But raising taxes on individuals, families, and businesses that are already struggling to make ends meet is not the best answer.”

“More and more, the rating agencies are being used as weapons against taxpayers, such as in Oklahoma, Kansas, and Illinois,” Small continued. “In Illinois, a rating agency recently tacitly endorsed Illinois’ 32 percent personal income tax increase and couldn’t bring itself to focus on Illinois’ unreformed, massive spending problem and significant out-migration due to its ever-climbing tax burden and strangling economic and regulatory environment.”

The study is authored by Small and William Freeland, an independent public policy analyst, research economist, and data scientist with a decade of experience in public policy research and advocacy.

About the Oklahoma Council of Public Affairs

The Oklahoma Council of Public Affairs (OCPA) is a public policy research organization focused primarily on state-level issues. OCPA conducts research and analysis of public issues in Oklahoma from a perspective of limited government, individual liberty, and a free-market economy.

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OCPA Appoints Bergen, Oster, and Wehrenberg to Board of Trustees
New members bring experience from business, agriculture, and community affairs to OCPA

OKLAHOMA CITY—The Oklahoma Council of Public Affairs (OCPA) announced today the addition of three new members to its Board of Trustees— Susan Bergen of Norman, Andrew Oster of Edmond, and Molly Wehrenberg of Edmond.

“I am very pleased to welcome our new board members,” OCPA Chairman Larry Parman said. “Their years of leadership, service to Oklahoma, and entrepreneurship will be a wonderful asset to our organization and assist OCPA’s mission of limited government, individual liberty, and free-market principles.”

An entrepreneur, Susan Bergen is the President and CEO of Bergen Enterprises, established in 1965. Bergen began managing Peach Crest, a 330-acre organic farm located in Norman in 2003. In 2015, she expanded Peach Crest to include over 20,000 acres of ranchland where beef is raised. In addition to products sold in grocery stores and restaurants, Bergen Ranch partnered with the Lynn Institute to plant seven community gardens in northeast Oklahoma City to provide fresh fruits and vegetables to food deserts in the metro area.

Andrew Oster is the President and Chief Compliance Officer of Triton Wealth Advisors LLC in Edmond. A certified financial planner, Oster founded Oster Financial Group LLC in 2006, which expanded to Triton Wealth in 2011. He previously served on the Oklahoma Teacher Retirement System’s Board of Trustees, which is responsible for managing $14 billion in pension funds for Oklahoma educators. Oster currently serves on the Board of Advisors for the Department of Finance at the Michael F. Price College of Business at the University of Oklahoma and as an arbitrator for the Financial Industry Regulatory Authority (FINRA). He is a co-author of the book “Plan of Action: Strategies to Help You Build and Preserve Wealth.”

Molly Wehrenberg served as the head nurse of St. Anthony’s Hospital Eye Surgery Unit until her retirement when she began translating Spanish for doctors and non-English speaking patients. She is active in and dedicated to multiple organizations that support metro Oklahoma City, including serving on the Board of Directors for Celebrations!, Visionary Oklahoma Women, and Mobile Meals. Wehrenberg is a citizen lobbyist and is involved in many government organizations including the Edmond Republican Women’s Club, the Oklahoma Chapter of Freedoms Foundation of Valley Forge, and the High Noon Club. She was a 2015 recipient of the George and Martha Washington Award and the 2016 Good Samaritan Award for BOTT Radio. Wehrenberg also serves on the Advisory Board of the Oklahoma Commission on the Status of Women.

“It’s an honor to have a board of talented and diverse individuals to lead OCPA in its work,” OCPA president Jonathan Small said. “I look forward to working with our new members to limit government and empower Oklahomans.”

About the Oklahoma Council of Public Affairs

The Oklahoma Council of Public Affairs (OCPA) is a public policy research organization focused primarily on state-level issues. OCPA conducts research and analysis of public issues in Oklahoma from a perspective of limited government, individual liberty, and a free-market economy.

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OKLAHOMA CITY (May 22, 2017) – Today, the Oklahoma House of Representatives passed House Bill 2403 by a vote of 56 to 40. The bill would restrict itemized deductions in order to increase personal income tax collections by more than $101 million annually.

Jonathan Small, president of the Oklahoma Council of Public Affairs, issued the following statement after today’s vote on HB 2403:

“House Bill 2403 is an unconstitutional tax hike on working Oklahoma families and senior citizens. Should House Bill 2403 become law, we intend to challenge its constitutionality at the Oklahoma Supreme Court as a violation of State Question 640.

“House Bill 2403 is designed to raise revenue for state government, but it passed the state House of Representatives with far less than a three-fourths vote. This makes it a blatant violation of Oklahoma’s Constitution, suggesting our state’s highest Court would strike it down.

“This bill is an income tax increase of over $101 million a year that targets Oklahomans who own a home with a mortgage, who pay property taxes that support local schools and other services, or who are being crushed by heavy medical bills.

“As part of the challenge we intend to file, we will likely also include Senate Bill 1606, which was a $97 million income tax increase [LINK] that passed the state House last year with only 51 votes [LINK]. In addition, we’ll likely include House Bill 2348, which passed the House earlier this session with only 51 votes and has already been signed into law [LINK].

“By capping the standard deduction, House Bill 2348 represents an income tax increase of more than $19 million annually [LINK], mostly on middle- and lower-income Oklahomans already struggling to make ends meet.

“After being hit in the early ‘90s with one of the largest tax increases in state history, Oklahoma voters rose up and amended our state’s Constitution with State Question 640.

“State Question 640 established strong protections for Oklahomans from being slammed with more tax increases in the future. Among these protections, it requires either a three-fourths supermajority vote in both legislative chambers, or a vote of the people, to adopt a tax increase.

“Here at OCPA, we’ve consistently offered hundreds and hundreds of millions of dollars’ worth of options for addressing the state’s budget shortfall and preserving core services without raising taxes on Oklahomans. We continue to stand with hard-working taxpayers in favor of efficient government services and in defense of the state Constitution.”

Link to the full text of State Question 640, passed in 1992 by Oklahoma voters on the statewide ballot: https://www.sos.ok.gov/documents/questions/640.pdf

# # #

To hear some at the state Capitol talk, every agency is on starvation rations due to the state budget shortfall. The executive branch made presentations offering a doom-and-gloom picture of government agencies implying that if funding remains flat for the largest seven agencies then the other 60 agencies would be eliminated.

But, despite this sky-is-falling rhetoric, many agencies are actually spending more than they were in recent years while others have seen only minimal financial impact from the budget downturn.

How is this possible? The appropriated budget passed each year by the Legislature is only a portion – in some cases, a small slice – of the total amount of dollars available to many agencies. Many agencies receive much of their funding through other means, whether that is direct tax dollars, fees, or federal tax dollars.

The Space Industry Development Authority has seen its state appropriation trimmed by more than 40 percent since 2009, but it spent almost $3.5 million this year, more than double what it spent as recently as 2014. Why? It leases out buildings and land and collects revenue.

Read the complete story on journalrecord.com

OCPA Offers Balanced Budget Plan with a Teacher Pay Raise
Plan includes a $1,000 teacher pay raise for K-12 public school teachers and
the elimination of personal income tax for classroom teachers

OKLAHOMA CITY – The Oklahoma Council of Public Affairs (OCPA) released today a budget plan to fill Oklahoma’s $878 million budget gap and give teachers a pay raise.

“This budget proposal respects and protects Oklahoma families and their own budgets,” OCPA President Jonathan Small said. “The Oklahoma economy faces serious challenges, so it’s only appropriate that state government adjust spending to match tax revenue instead of considering harmful tax increases that burden Oklahoma families and businesses.”

The balanced budget plan proposed by OCPA includes more than $1.3 billion in savings—including items from OCPA’s “Freedom Agenda” published in January and “First Steps” list released in February—and $337 million in tax increases, including an increase in the tax on gasoline and diesel, a 67-cent per pack cigarette tax increase, and a wind production tax. Together, the lower spending and increased taxes add up to nearly $1.7 billion.

This budget plan would fully fund a $1,000 teacher pay raise for K-12 public school teachers as well as the elimination of personal income tax for classroom teachers. Base pay and income tax are the main reasons cited by teachers that leave Oklahoma for states like Texas.

To fund the teacher pay raise and income tax elimination, OCPA recommends an increased exclusivity fee for Class III gaming and increased 1017 Fund deposits due to the increased exclusivity fee for Class III gaming.

“We are very aware of the growing tribal sector compared to the non-tribal sector,” Small said. “Given that Oklahomans expanded gaming in the mid-2000s specifically for education and teacher pay raises, it’s fitting that gaming fees be increased to reflect the enormity of the gaming industry and fund a $1,000 teacher pay raise and income tax elimination.”

With just over a week until the end of the regular legislative session, some lawmakers have proposed massive tax increases, including a plan to cap personal itemized deductions that would dramatically increase personal income taxes on many Oklahoma families and small businesses.

“We understand the corner the Legislature is in, and appreciate the hard work they are doing to reach reasonable solutions,” OCPA Chairman Larry Parman said. “We look forward to continuing to work with lawmakers to not just balance a budget, but build a state.”

About the Oklahoma Council of Public Affairs

The Oklahoma Council of Public Affairs (OCPA) is a public policy research organization focused primarily on state-level issues. OCPA conducts research and analysis of public issues in Oklahoma from a perspective of limited government, individual liberty, and a free-market economy.

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This week, House and Senate committees at the Oklahoma Legislature have passed multiple bills, including House Bill 2347 and House Bill 2403, which cap personal itemized deductions effective January 1, 2017. Dr. Tom Coburn has issued the following, updated statement regarding efforts to have one of these bills approved by the entire Legislature and sent to the Governor for approval:

“Efforts to cap itemized deductions in order to increase personal income taxes by more than $100 million on hundreds of thousands of Oklahomans directly oppose the promises by conservatives to do the tough work of going line by line through every expenditure of government and to reform government so that it lives within the current tax burden in Oklahoma, especially during a tough economy. These efforts should stop immediately.

“Oklahoma’s economy is hurting due to the recessionary effects of OPEC’s energy price war and stagnant economic growth due to the failed tax, spend, and regulate policies for 8 years under the Obama administration.

“Oklahoma policymakers shouldn’t exacerbate Oklahoma’s problems by enacting a tax increase that penalizes the productive behavior of Oklahomans who have a mortgage, who pay significant sums of property taxes to support their local schools, and who pay for significant family medical expenses.

“Oklahoma policymakers should reject efforts to pass backdoor income tax increases and instead work to eliminate millions in subsidies for out-of-state wind companies, millions in bloat and waste in higher education, millions in tobacco settlement spending on efforts harassing Oklahomans about their health, millions diverted to the build-up of funds for Career Tech buildings and non-classroom spending in common education, millions in rebates for tribal entities selling cigarettes, millions in preferential tax treatment for tribal activity that competes with non-tribal commerce, and millions in administrative overhead exploding in our public schools. Ending these inappropriate spending efforts are all better substitutes than a personal income tax increase of more than $100 million on hundreds of thousands of Oklahomans.

“I urge Oklahomans across the state to make your voices heard over the throng of lobbyists, special interests and tax consumers who are inundating lawmakers with the rhetoric that the sky is falling and you must pay more in taxes—and urge your legislators and the Governor to oppose HB 2347, HB 2403 and any efforts increasing personal income taxes on Oklahomans.

“I urge lawmakers and the Governor to reject the rhetoric of lobbyists, special interests and tax consumers and fulfill their campaign promises to protect taxpayers.”

By Steve Anderson, CPA and Jonathan Small, CPA

The Oklahoma Policy Institute (OPI) recently attacked Oklahoma-based Devon Energy, accusing the corporation of a windfall of profits and avoiding Oklahoma corporate income taxes. Here is the statement that OPI released:

“Number for the day 0.3%—Effective state corporate income tax paid by Devon Energy in (sic) from 2008 to 2015. Over that period, the company made $21.76 billion in profits but paid only $71 million in corporate income taxes, more than $1.2 billion less than if the company paid Oklahoma’s official corporate income tax rate of 6%.”

OPI cites the analysis of the Institute on Taxation and Economic Policy (ITEP), a hard-left and George Soros-funded organization that has a long history of misrepresentation.

Apart from the issue of using phony data, OPI, who is actively engaged in trying to move Oklahoma’s tax code in a significantly more liberal direction and raise taxes by more than $1.4 billion annually, appears to be unaware of how companies are taxed. OPI appears to not realize that state income taxes are paid in the state where the income is earned.

It is well known that Devon has holdings in several states, as well as an extensive operation in Canada. In the United States, their largest area of oil and gas production was the Barnett Shale in Texas followed by the Eagle Ford in Texas. Only recently has Devon made a decision to expand operations in the Oklahoma Anadarko Basin, expanding their production beyond the 9% of total production prior to that in Oklahoma.

Commerce-aware Oklahomans know that Devon had significant operations outside the state. Even if the data for the study was correct, this fact alone renders OPI’s statement misleading. Oklahoma will never have a right to charge corporate income tax on corporate income that wasn’t earned in Oklahoma and is subject to another state’s taxing jurisdiction.

Read the complete story on ocpathink.org

Yesterday, the House and Senate Joint Committee on Appropriations and Budget passed House Bill 2347, which caps personal itemized deductions effective January 1, 2017. Dr. Tom Coburn has issued the following statement regarding efforts to have the bill approved by the entire legislature and sent to the Governor for approval.

“Efforts to cap itemized deductions in order to increase personal income taxes by $187 million on more than 426,000 Oklahomans directly oppose the promises by conservatives to do the tough work of going line by line through every expenditure of government and to reform government so that it lives within the current tax burden in Oklahoma, especially during a tough economy. These efforts should stop immediately.

“Oklahoma’s economy is hurting due to the recessionary effects of OPEC’s energy price war and stagnant economic growth due to the failed tax, spend, and regulate policies for eight years under the Obama administration.

“Oklahoma policymakers shouldn’t exacerbate Oklahoma’s problems by enacting a tax increase that penalizes the productive behavior of Oklahomans who tithe, have a mortgage, charitably give, pay significant sums of property taxes to support their local schools, and pay for significant family medical expenses.

“Oklahoma policymakers should reject efforts to pass backdoor income tax increases and instead work to eliminate millions in subsidies for out-of-state wind companies, millions in bloat and waste in higher education, millions of tobacco settlement spending on efforts harassing Oklahomans about their health, millions diverted to the build-up of funds for Career Tech buildings and non-classroom spending in common education, millions in rebates for tribal entities selling cigarettes, millions in preferential tax treatment for tribal activity that competes with non-tribal commerce, and millions in administrative overhead exploding in our public schools. Ending these inappropriate spending efforts are all better substitutes than a personal income tax increase of $187 million on 426,000 Oklahomans.

“I urge Oklahomans across the state to make your voices heard over the throng of lobbyists, special interests, and tax consumers who are inundating lawmakers with the rhetoric that the sky-is-falling and you must pay more in taxes—and urge your lawmaker and the Governor to oppose HB 2347 and any efforts increasing personal income taxes on Oklahomans.

“I urge lawmakers and the Governor to reject the rhetoric of lobbyists, special interests, and tax consumers and fulfill their campaign promises to protect taxpayers.”

Dear Lawmaker:

In the past few days a number of memos, emails and letters have been distributed regarding solutions to Oklahoma’s current budget challenge.

This is a sensitive time when well-intended people on all sides of the argument are working hard to create a satisfactory solution to a complex situation. You are to be congratulated and thanked for your service and willingness to tackle these difficult issues.

It is also a time to not let emotions control the conversation. It’s a time to focus on balancing a budget and building a state. Solutions we create today will have far-reaching implications. OCPA is committed to continuing to offer strategic and thoughtful policy recommendations for your consideration.

Let us clear up one thing. Tradition holds that the Governor presents an outline of policy priorities during the State of the State message. Governor Fallin laid out her plan to address the budget shortfall. We differ with the over-arching strategy, some of the recommendations and the premises that underlie them.

For example, we believe there is ample opportunity to look for savings within the state government system. That’s what fiscal conservatives do. One dollar of waste and inefficiency saved is a dollar of new revenue not required. Take education for example. We continue to fund an underperforming, top-heavy, bureaucratic system that is failing children who need an “I am prepared” education. Taxpayers receive a return on that investment of 39th in 8th grade reading and 46th in 8th grade math. Yet, we continue to heed the call of education producers for “more money” without reform and the true cost of our failure is paid for by the unprepared kids. More money without reform will change no outcome and only create a larger, ineffective system.

When the narrative is “We have a revenue problem,” we should not be surprised that the only path offered to achieve a balanced budget is to take the easy way out and manufacture more revenue. In this case through a nearly $2 billion tax increase…one that will never go away. That’s one possibility.

Another narrative is “there’s nothing else to cut.” That’s another possibility, but our experience and research suggests otherwise. But to do so requires hard work, clear thinking, and a relentless pursuit of carving out marbled waste within the meat of each agency. It risks disappointing someone and we get our hands dirty.

So, instead, some want to solve the problem by force – tax increases. This would be like a business going to its customers, notifying them of their money-losing operation and forcing them to pay more or buy more product.

Another possibility is to modify our tax structure so we tax work less in exchange for taxing consumption more. Or examine, perhaps eliminate, policies that siphon revenue from state coffers.

There are two bedrock issues that are absolutes in building a great state – a dynamic economic environment that encourages the creation of high-paying jobs and an excellent education system that stresses rigor and accountability. Without these, little else matters.

OCPA has been criticized by some for constantly saying NO. That refrain has been delivered throughout the halls of the Capitol for years.  It is a specious argument with no basis in fact. OCPA has led the charge, and been highly supportive of many significant reforms in recent years. But, when policy reflects a continuous shift to the left and abandons the principles of free markets, individual initiative/responsibility and limited government, we will always say NO.

Here’s why the argument is flaccid. OCPA was not the first to say NO. Budget proponents said “No” to conservative ideas. They said “No” to the idea of limited government. They said “No” to the idea of taxing work less in exchange for increasing taxes on consumption and services. Proponents said “No” to the idea of first creating greater efficiency in government. And, their “Yes” to nearly $2 billion of tax increases without reform is not good for the long-term viability or competitiveness of our state.

We continue to believe that for Oklahoma to be a high-achiever we must be a smarter, more prosperous state served by a lean, efficient government. That statement is principled and compatible with OCPA’s mission – free markets, individual initiative/responsibility and limited government. OCPA will continue to advocate policies based on conservative principles as an alternative when political expediency ignores them.

We encourage you to let your upcoming decisions rest on principle, not expediency. We encourage you to not just balance the budget, but also focus on building a state. You represent your state, not just your district. By your vote you accept responsibility for the outcome those votes create. We believe the OCPA mission – free markets, individual initiative/responsibility and limited government are the decision filters that will produce the best long-term outcomes for Oklahoma. We look forward to continue working with you for the betterment of all Oklahomans and thank you for your service.

Sincerely,

Larry V. Parman
Chairman of the Board of Trustees

Jonathan Small
President

Read the complete letter on ocpathink.org