In The Know: Plunging natural gas prices affecting tax cut discussions

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 plunging natural gas prices are beginning to impact lawmakers’ discussions over further income tax cuts. Industry analysts said that a hostile takeover of Chesapeake Energy is unlikely because Oklahoma law makes it difficult and nobody wants the company.

The Tulsa World profiled the difficult jobs of Oklahoma child welfare workers who respond in cases of suspected abuse or neglect. Officials say conditions have improved for medical and mental health treatment in the Oklahoma County jail, but some potential civil rights violations identified by the Justice Department remain.

House Speaker Kris Steele writes in NewsOK that core services haven’t been harmed to pay for tax cuts in the past. OK Policy previously discussed some of the many ways that budget cuts are harming core services. In letters to the editor published by NewsOK and the Tulsa World, Oklahomans write that property taxes will increase following income tax cuts, tax cuts are not supported by Oklahomans, and they won’t lure businesses here.

Declining vaccination rates in Oklahoma are resulting in outbreaks of diseases long kept at bay. The First Bank and Trust Co. froze the accounts of the Cheyenne and Arapaho Tribes of Oklahoma amid a conflict over tribal leadership.

The Number of the Day is the percentage of Oklahomans who adhere to a Protestant religion. In today’s Policy Note, the Economic Policy Institute gives an overview of the crisis facing low-wage workers in America.

In The News

Legislators wary of natural gas price

Plunging natural gas prices are prompting some concern from state leaders as lawmakers continue discussions on cutting the state’s income tax and developing a budget for the upcoming fiscal year that begins July 1. State lawmakers are projected to have an estimated $6.6 billion to spend on the fiscal year 2013 budget, but that estimate was calculated with a projected price of natural gas of $3.64 per 1,000 cubic feet. The price of natural gas closed Friday at $2.19 per 1,000 cubic feet. “For every dollar up or down from the target prices, the impact is $70 million,” State Senator Patrick Anderson said. “So now, $1.63 is close to $100 million short of what we thought we would have in February.” He said that will be a huge issue, plus it factors into the decision on an income tax cut. “All of us that are discussing and negotiating an income tax are very concerned about the drop in the price of natural gas,” said Rep. Earl Sears, R-Bartlesville, the chairman of the powerful House Appropriations Committee and a key negotiator on plans to cut the state’s income tax. “However, even with the continued drop, we feel it’s important to continue developing and reforming the income tax plan. There’s no question if the price continues to drop, it will have an impact on our discussions.”

Read more from the Enid News and Eagle.

Chesapeake Energy Corp. not likely to change hands, analysts say

Chesapeake Energy Corp.’s stock price has tumbled 48 percent since August as natural gas prices have plummeted and questions have arisen about the company’s ability to meet its announced spending goals. Strong assets and a low sales price often lead to takeover talk, but one thing agreed on by the widely varied analysts who follow the company is that Chesapeake is not likely to change hands anytime soon. “If I’m a major (integrated oil company) and would have the chance to take over these assets and get them at a steal, I’d go for it,” “But you’re going to have to claw them out of (CEO) Aubrey (McClendon’s) cold, dead hands. He’s not giving the company up.” Oklahoma law allowing staggered terms for directors makes a hostile takeover more difficult, Kelly said. Analyst Philip Weiss agrees that Chesapeake is not a likely takeover target, but for a different reason. “Nobody wants that,” Weiss said.

Read more from NewsOK.

Child welfare workers get first-hand view of tragic situations

It’s a common injury seen by child welfare investigator Jessica Martin, and it speaks volumes about abuse and neglect in Oklahoma: ramen noodle burns. Children burn themselves pulling the 20-cents-per-package instant noodles from a microwave, pouring it onto their laps or eating it prepared way too hot. Sometimes it’s an accident. Sometimes it’s neglect or lack of supervision. But there are far more dangerous threats to Tulsa County children, she said. Those are among a list of societal ills including drug use, alcoholism, poor parenting skills, lack of education, poverty, hair-trigger tempers and a reluctance by the public to get involved. “I don’t even know how many child deaths I’ve seen,” she said. “There have been so many.” The Tulsa World spent two days shadowing child welfare workers who respond in cases of suspected abuse or neglect. The Oklahoma Department of Human Services workers vary in experience, but they have the same obstacles and goals. “The pay is horrible and the caseloads are too large,” Martin said. “But we want to go out and help people. We want to keep children safe and get families the services they need.”

Read more from The Tulsa World.

Oklahoma County jail conditions improve, but deficiencies remain

County officials say major improvements have been made in the medical and mental health treatment of prisoners in the Oklahoma County jail, an issue the U.S. Justice Department has identified as a serious problem. Oklahoma County Sheriff John Whetsel said the county jail is the largest mental health facility in the state, with about 350 to 400 inmates diagnosed with a mental disorder or on psychotropic medication at any given time. Justice Department officials said in a letter to the county dated March 15 that a failure to address problems with the jail’s medical and mental health treatment programs appears to be contributing to significant harm at the jail. At least three of seven deaths reported at the jail since March 2011 involved serious clinical missteps, including a lack of appropriate assessments and follow-ups and tasks beyond the clinical capabilities of staff, according to the letter. Whetsel said 56 of 60 potential civil rights violations identified by the Justice Department in 2007 will no longer be monitored, but funding limits the county’s ability to address these final problems.

Read more from NewsOK.

House Speaker: Core services haven’t been harmed by tax cuts

Amid all the intense focus and rhetoric on the personal income tax reduction proposals before the Legislature, something has been lost. There’s been little discourse on how the state arrived at this point. This lack of historical context has allowed misleading claims to be spread by tax consumers and other tax-reduction opponents who’ve falsely cast the current income tax reduction discussion as some sort of reckless Republican crusade. History shows nothing could be further from the truth. Core services haven’t been harmed to pay for tax cuts in the past and they won’t be now!

Read more from NewsOK.

Previously: How Oklahoma is falling behind from the OK Policy Blog

See also: Property taxes will increase without income tax from NewsOK; Tax cuts not supported by Oklahomans from The Tulsa World; Tax cuts won’t lure business from NewsOK

Human ‘herd’ threatened by declining inoculation rates

Shannon Culler didn’t think much of it when she developed a cough just after coming home with her newborn baby, Kadyn. Two-week-old Kadyn got “stuffy and congested” too. A trip to the doctor led to a trip to the emergency room. “It’s never a good sign that the doctor’s nurse rides in the back seat with you to the hospital to make sure your baby doesn’t stop breathing.” It was learned Kadyn had pertussis, a potentially deadly condition commonly known as whooping cough. It’s believed Kadyn caught it from her mother, who unknowingly had been exposed to it by the child of a friend. At two weeks, Kadyn was far too young to have gotten the pertussis vaccine. It’s now known that the practice of “cocooning” – inoculating adults who will be around newborns – can keep babies from becoming infected. For various reasons, vaccination rates are falling, and the result increasingly is outbreaks of diseases long kept at bay. Oklahoma has some of the lowest rates of all and is among the 10 states with the highest percentage of children receiving no immunizations at all.

Read more from The Tulsa World.

Okla. bank freezes fractured tribes’ bank accounts

A Clinton bank issued an administrative freeze on bank accounts of the Cheyenne and Arapaho Tribes of Oklahoma — prompting tribal leaders to declare a state of emergency Friday and announce that tribal assistance to the elderly, poor, children and medically needy could be drastically cut. Tribal employees will be trimmed to a 32-hour workweek starting next week, said Lisa Liebl, a tribal spokeswoman. The tribe has several hundred employees, she said. The tribes’ Lucky Star casinos at Concho, Clinton, Canton, Watonga and Hammon are expected to continue normal operations, although that could change as tribal officials continue to evaluate the crisis, she said. The First Bank and Trust Co. of Clinton took action to freeze the accounts Tuesday amid a billowing conflict over tribal leadership. Boswell and Leslie Wandrie-Harjo have been quarreling for more than a year over which of the two is the tribes’ lawful governor.

Read more from NewsOK.

Quote of the Day

It’s so ironic that the people we trust with our children and keep them safe – teachers, child-care providers, child welfare workers – get paid the least.
Emily Meyer, an Oklahoma child welfare worker

Number of the Day

72 percent

Percentage of Oklahomans who adhere to a Protestant religion, compared to 51 percent nationally in 2007.

Source: The Pew Forum on Religion & Public Life

See previous Numbers of the Day here.

Policy Note

Future economic prosperity for low-wage workers hinges on improved job quality of current jobs, not occupational upgrades

Many workers are facing uniquely tough times. Though now below its recessionary peak of 10 percent in October 2009, unemployment remains high at 8.2 percent, and job growth is slow. With around 25 million people unemployed or underemployed, it is clear that the jobs crisis did not subside with the official end of the recession. Moreover, workers are still suffering from difficulties that materialized in the decades before the Great Recession, such as deteriorating job quality and stagnant wages. The economic expansion from 2001­–2007, for instance, was among the weakest on record; typical family incomes grew by less than one half of one percent between 2000 and 2007 (Bivens 2011). These economic challenges are particularly acute for workers at the bottom of the wage scale. This paper focuses on low-wage workers—who they are, where they work, where they live, and what their future challenges may be in regards to education/skill requirements, job quality, and wages. Analysis of employment projections from the Bureau of Labor Statistics (BLS) reveals that the future of work will be shaped by much more than labor market skill demands. And in the future, rising wages will depend more on the wage growth within occupations than on any change in the mix of occupations.

Read more from Economic Policy Institute.

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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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