In The Know: Income tax cut proposal may have trouble passing House

In The KnowIn The Know is a daily synopsis of Oklahoma policy-related news and blogs. Inclusion of a story does not necessarily mean endorsement by the Oklahoma Policy Institute. E-mail your suggestions for In The Know items to You can sign up here to receive In The Know by e-mail.

Today you should know that the income tax cut proposal may face trouble passing in the House tomorrow. The plan would reduce taxes for 54 percent of Oklahomans and raise taxes on 25 percent. The largest percentage facing a tax increase are those with between $10,000 and $16,000 in annual taxable income, while the group with the greatest percentage having a decrease are those earning between $150,000 and $499,000. The OK Policy Blog has a Q&A on the major aspects of the plan. Mickey Hepner writes that tax cuts are selling out the future.

Republican legislative leaders and the governor said they expect to finalize a budget deal by today. Increased heavy-truck traffic due to oil and gas production is causing significant wear and tear on state roads. The chair of the Oklahoma City Chamber writes that the American Indian Cultural Center needs to be completed or we risk seeing previous investments deteriorate. The Tulsa World reports that despite a recent federal agency’s threat to withhold $50 million from Oklahoma for violating confidentiality of abused and neglected children, at least 27 states have more liberal laws when it comes to disclosing documents to the public after child deaths.

With no agreement reached yet, a 60-day stay in the federal water rights lawsuit filed by two Oklahoma Indian tribes is expected to be extended. Investors are questioning the Chesapeake Board’s independence on revelations that they have received benefits including hiring a director’s relatives, donating millions of dollars to the university overseen by a board member, and doing business with a company headed by its lead director.

Parents are upset after a movie comparing abortion to the Holocaust was handed out to students at Wagoner High School. NewsOK writes that fears about the state’s increasing Hispanic population are overblown. The Number of the Day is the number of counties in Oklahoma where 50 percent or more of the children under 5 years of age are minorities. In today’s Policy Note, Barbara Ehrenreich discusses how employers, payday lenders, and local governments make profits from preying on the poor.

In The News

Income tax cut proposal faces stiff test in Oklahoma House

House Republicans unhappy with a proposed income tax-cutting measure could derail the plan by ganging up with House Democrats and vote to kill the measure this week. One in four of the 67 House Republicans would have to vote against their leadership in order to bring down the proposal, which was developed last week after two weeks of intense talks between the GOP governor and Republican legislative leaders. House Minority Leader Scott Inman, D-Del City, said the 31 members in his caucus are united to vote against the proposal contained in House Bill 3061. “Education has been cut by hundreds of millions of dollars over the last several years, class sizes are growing,” Inman said. “Our roads and bridges are crumbling, and we’re struggling to pay for core services for our senior citizens. To say that this is the time for hundreds of millions of dollars worth of tax cuts, we believe, is fiscal irresponsibility.”

Read more from NewsOK.

See also: GOP plan to cut taxes for 54 percent of Oklahomans, increase taxes for 25 percent from The Associated Press; Tax cut proposal Q&A from the OK Policy Blog

Mickey Hepner: Tax cuts don’t make the grade

When is not big enough also too big? When discussing state income tax cuts. Thursday night Gov. Mary Fallin and leading Republican legislators announced an agreement to enact a $102 million state tax cut. The surprise is not that a Republican governor and Republican Legislature have agreed to cut taxes. The surprise is that given their firm hold on power, and the tax cut drumbeat that has been beating incessantly for months, that the eventual tax cut will amount to less than 2 percent of state General Revenue fund collections. Still, it’s hard to make the case that even a 1.8 percent tax cut is affordable. Oklahoma’s common education funding is still $253 million less than pre-recession levels, and we rank 49th nationally on per-pupil spending. Meanwhile state support for higher education continues to erode, leading to higher tuition and more pain for Oklahoma families wanting a brighter future for their children. Few Oklahomans are satisfied with the state of our roads and bridges. The American Indian Cultural Museum — potentially a major tourism site — remains unfinished due to a lack of funding. And just this past week the cooling unit at the state Medical Examiner’s Office failed while legislators continue bickering over funding for a much-needed new ME’s building.

Read more from The Edmond Sun.

GOP lawmakers hope to finalize budget deal by today

Republican legislative leaders and the governor said Friday evening they are close to finalizing a $6.6 billion budget, but an agreement won’t be finalized until Monday. Private talks resumed Friday morning and continued until about 6 p.m. Lawmakers must approve a budget by 5 p.m. Friday. In addition to determining how to fund state agencies and services, lawmakers are talking about whether to issue bonds to repair and restore the state Capitol, build a state veterans office, finish the American Indian Cultural Center and Museum in Oklahoma City and build a pops center in Tulsa. Building a new headquarters for the state medical examiner’s office also is being discussed.

Read more from NewsOK.

Oil, natural gas boom taking toll on roads

The pace of oil and gas activity is readily evident when you drive the state’s roads, which have seen dramatic increases in heavy-truck traffic over the last year. All of that extra truck traffic causes significant wear and tear on the roads, and road crews are having a hard time stretching their manpower, and their revenues, to meet the extra demand. Cole Hackett, spokesman for Oklahoma Department of Transportation, said keeping up with road maintenance in heavily-traveled areas requires shifting crews away from other areas. And, the extra road maintenance doesn’t come with any extra revenue to cover the cost. He said funding for state road maintenance comes from the state gas tax, which is a flat rate at 17 cents per gallon, and funding is not tied to oil and gas production. The combination of increased road maintenance requirements, and no extra revenue to cover the expense, is taking a particularly heavy toll on county road budgets.

Read more from The Enid News and Eagle.

Chamber leader: Indian cultural center needs to be completed

After years of planning and fundraising, and countless hours of hard work by many individuals, the American Indian Cultural Center and Museum has reached a crossroads. In the next few days, the Legislature will ultimately determine whether this multi-million dollar cultural project will be completed. This is, as they say, where the rubber meets the road. The AICCM recently announced that it has raised $40 million in contributions from the Oklahoma community. The donations are from private citizens, businesses, tribes and nonprofits across the state — as well as the city of Oklahoma City. The amount raised speaks strongly to public opinion. Oklahomans want this center completed. We’ve reached a point where there are no more options. We either finish what we started, or risk seeing our investment begin to deteriorate due to lack of continued funds, and with it the dream of this world-class facility.

Read more from NewsOK.

State, feds in $50 million dispute over child welfare law

Despite a recent federal agency’s threat to withhold $50 million, no state has been warned or disciplined for releasing too much information after a child dies from abuse and neglect. That same agency conducted a survey showing that at least 27 states have more liberal laws when it comes to disclosing documents to the public after such child deaths. On May 9, the Dallas-based office of the U.S. Children’s Bureau, which is part of the federal Department of Health and Human Services, sent a letter to the state Department of Human Services stating that Oklahoma’s current laws violated a federal confidentiality provision for abused and neglected children. At issue is how much information to release. The Child Abuse Prevention and Training Act allows states to disclose “case” information after a child abuse death or near death. The federal agency interprets “case” to mean only the incident causing the death. Oklahoma and other states allow for a review of all contacts between the agency and family prior to death.

Read more from The Tulsa World.

60-day stay not enough to settle water rights dispute, officials say

A 60-day stay granted in the federal water rights lawsuit filed by two Oklahoma Indian tribes is expected to be extended, the state attorney general’s office reported. The stay was granted March 27, but the two sides have yet to reach an agreement. The initial stay is set to end in late May. The Chickasaw and Choctaw nations filed a lawsuit in federal court in August, essentially laying claim to the water rights in much of southeastern Oklahoma. The state filed a suit of its own, in state court, before a federal judge took the unusual step of moving the case to federal court. The 60-day stay was granted roughly two weeks later. Patrick Wyrick, one of the attorneys heading up the negotiations for the attorney general’s office, said the state is working to extend the stay issued by a federal judge. Stephen Greetham, chief general counsel for the Chickasaw Nation, said he couldn’t comment about whether the stay would be extended, but said the tribes remain committed to the ongoing negotiations. Since the stay was granted, little news about progress has been made public.

Read more from NewsOK.

Chesapeake board member perks raise doubts about independence

Chesapeake Energy Corp’s decision to cut directors’ pay and other perks may save the company up to $1.65 million a year without addressing investors’ concern that the board failed to rein in Chief Executive Officer Aubrey McClendon’s borrowing and spending spree. The board’s history of close ties to McClendon, of being paid more than directors at similarly sized energy companies and of rewarding the CEO even as Chesapeake plunged in value may hinder its ability to oversee a turnaround of the company. The company’s flip flop on how much it knew about a program it approved that allowed McClendon to acquire a 2.5 percent share in each of the company’s wells — and amass more than $846 million in debt from companies and banks also doing business with Chesapeake — has sparked demands from some investors for new directors. Chesapeake has business ties to some of its eight outside directors, who’ve received benefits aside from their compensation, according to a Bloomberg review of past disclosures. Those benefits include hiring a director’s relatives, donating millions of dollars to the university overseen by a board member, and doing business with a company headed by its lead director.

Read more from Businessweek.

NewsOK: Don’t fear demographic change

Whites of European ancestry now represent less than half of all births in the United States. In many Oklahoma counties, at least 25 percent of children younger than 5 are minorities, due largely to American Indians and Hispanics. U.S. Census Bureau numbers indicate that immigration isn’t the main cause of the change, however. Instead, differences in birthrates explain the shift. In some rural areas, minorities are a substantial share of the total population. Local schools have growing demand for bilingual teachers. In Texas County, in the Oklahoma Panhandle, around 42 percent of residents are now Hispanic. Some will see these changes as a worrying trend, but history suggests those fears are overblown. First, most Hispanics are legal residents and the educational system is a key part of the assimilation process. In the long run, those children will be as influenced by Oklahoma’s culture as the state’s culture is impacted by their addition. Concern about associated impact on government services should be balanced against greater contributions to our tax coffers, economic growth and culture. Minorities are keeping some rural communities alive, such as those in the Panhandle. And it’s estimated Hispanics buy about $5.8 billion of goods and services annually in Oklahoma and own nearly 5,500 businesses. Those aren’t bad things.

Read more from NewsOK.

Movie comparing abortion to the Holocaust shown to Wagoner students

A movie comparing abortion to the Holocaust was handed out to students at Wagoner High School. Now parents demand answers. The movie titled “180” opens with images of Hitler and the Holocaust where 6 million Jewish people were killed in concentration camps in Nazi Germany. After a brief discussion between the host and the interviewees, the conversation then turns to abortion and compares the two. “She said that she had seen a DVD in school that basically said that if you have an abortion then you are no better than the Nazis and you will go to hell,” says concerned parent, Marty Angus. Angus was furious after his stepdaughter came home and told him she had seen it in class. “She said well, we went to our lockers on break and there was a note that said come pick up your free DVD,” says Angus. We did some checking with the district, officials tell FOX23 a local family asked the principal at the school if they could give the DVD to students. The answer was yes, but only if the students got parental consent first. Superintendent Marte Thompson told FOX23 a student aide accidentally handed out the movies before the school got the needed consent.

Read more from Fox23.

Quote of the Day

It hasn’t passed yet. You’re not going to get any Democratic votes, and you’ve got a lot of disgruntled Republicans that either didn’t get enough or don’t think we need a tax cut, period, at this time.
-Rep. David Dank, R-Oklahoma City

Number of the Day


Number of counties in Oklahoma where 50 percent or more of the children under 5 years of age are minorities, 2010

Source: U.S. Census Bureau

See previous Numbers of the Day here.

Policy Note

How corporations and local governments use the poor as piggy banks

Individually the poor are not too tempting to thieves, for obvious reasons. Mug a banker and you might score a wallet containing a month’s rent. Mug a janitor and you will be lucky to get away with bus fare to flee the crime scene. But as Business Week helpfully pointed out in 2007, the poor in aggregate provide a juicy target for anyone depraved enough to make a business of stealing from them. The trick is to rob them in ways that are systematic, impersonal, and almost impossible to trace to individual perpetrators. Employers, for example, can simply program their computers to shave a few dollars off each paycheck, or they can require workers to show up 30 minutes or more before the time clock starts ticking. Lenders, including major credit companies as well as payday lenders, have taken over the traditional role of the street-corner loan shark, charging the poor insanely high rates of interest. When supplemented with late fees (themselves subject to interest), the resulting effective interest rate can be as high as 600 percent a year, which is perfectly legal in many states. It’s not just the private sector that’s preying on the poor. Local governments are discovering that they can partially make up for declining tax revenues through fines, fees, and other costs imposed on indigent defendants, often for crimes no more dastardly than driving with a suspended license. And if that seems like an inefficient way to make money, given the high cost of locking people up, a growing number of jurisdictions have taken to charging defendants for their court costs and even the price of occupying a jail cell.

Read more from Mother Jones.

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Gene Perry worked for OK Policy from 2011 to 2019. He is a native Oklahoman and a citizen of the Cherokee Nation. He graduated from the University of Oklahoma with a B.A. in history and an M.A. in journalism.

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