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In 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 gperry@okpolicy.org. You can sign up here to receive In The Know by e-mail.
Today you should know that a law that provides public money for special needs students to attend private schools is becoming the center of a growing battle about the overarching issue of school vouchers. An OU sociology professor who studies women’s incarceration said significant corrections reform will not occur unless lawmakers revise the entire criminal code. Senator Tom Coburn called for eliminating federal grants to promote marriage, which are based on a program pioneered by Oklahoma in 2000. The OK Policy Blog previously featured a discussion on this program and whether the state should be supporting marriage.
The executive director of the Oklahoma Municipal League explains in NewsOK how not charging sales tax for online purchases puts municipalities and local businesses in a tough spot. Reporters at The Norman Transcript, The Muskogee Phoenix, and Enid News examined the local impact of this loophole. The Oklahoma Supreme Court ruled that the state must pay the Mountain View-Gotebo school district $733,000 in property tax reimbursements. Mercy Health, which has revenue of $4 billion and operates 27 hospitals in Oklahoma and surrounding states, has avoided most taxes and financial disclosure requirements by operating as a church.
With its contract about to be renewed, wasteful expenditures by the Emergency Medical Services Authority that provides ambulance service to Oklahoma City and Tulsa are under scrutiny. Oklahoma doctors received more than $6.3 million in payments, meals, or other items from 12 pharmaceutical companies since 2009. An estimated 115,000 Oklahomans currently are caregivers to their sick, infirm or dying loved ones, and their numbers are growing. DHS may be asked to take more oversight of children exposed to illicit drugs, but it is unclear how they will manage an increased caseload without funds for more staff.
The Number of the Day is how many USDA certified organic farms are in Oklahoma. In today’s Policy Note, economist Mark Thoma explains in MSN Money why we have room to spread the wealth without harming efficiency and growth.
In The News
School voucher law under scrutiny
The Lindsey Nicole Henry Scholarships for Students with Disabilities Act has become the center of a growing firestorm in the state – not just over the constitutionality of using public money for private schools but also about the overarching issue of school vouchers. “The author of the bill said unequivocally that this was just a first step (toward universal vouchers in Oklahoma),” said Union Superintendent Cathy Burden. Rep. Jason Nelson, R-Oklahoma City, co-sponsor of the law with Sen. Patrick Anderson, R-Enid, doesn’t deny his stance on vouchers. “I’ve made no bones about it. I’m for school choice because it works.” Nelson said the intent of the law – modeled on a 1999 Florida voucher law – is to meet the needs of those few special education students who are floundering in public schools. More than 96,000 students in the state are eligible for the scholarships. This year, nearly $700,000 worth of taxpayer money has already been spent for 95 students to attend private – mostly religious – schools, state data show.
Read more from The Tulsa World.
Professor: Oklahoma should incarcerate fewer people
“Oklahoma lawmakers should seize the opportunity to overhaul the state’s restrictive criminal code and lock up fewer people, particularly women,” Dr. Susan Sharp, a University of Oklahoma sociology professor told Cleveland County Democrats on Friday. “If we don’t do something now, I’m afraid we will miss the opportunity,” she said. Last session, the Legislature and Gov. Mary Fallin passed into law House Bill 2131, which increases the eligibility of prisoners, who can be considered for GPS monitoring and community sentencing, rather than incarceration. The bill already has drawn the ire of several district attorneys throughout the state who are alarmed because an estimated 250 prisoners could be released into the public. Oklahoma has incarcerated about 25,000 prisoners. Sharp said significant corrections reform will not occur unless state legislators and the governor revise the entire criminal code.
Read more from The Norman Transcript.
Sen. Tom Coburn would divorce marriage programs from federal funding
Former Oklahoma Gov. Frank Keating broke new ground in 2000 when he proposed using federal welfare money to promote marriage. That initiative went nationwide in 2005 and now the federal government spends $150 million a year for healthy marriage and responsible fatherhood programs nationwide that, for the most part, have no metrics for success. In his $9 trillion plan to reduce future deficits, Sen. Tom Coburn, R-Muskogee, called for eliminating the annual grants. The Oklahoma program that grew out of Keating’s initial proposal is now called the Oklahoma Marriage Initiative and is overseen by a private company, Public Strategies, Inc., in Oklahoma City. Public Strategies, which also operates the National Healthy Marriage Resource Center, received a $2.5 million grant from the Department of Health and Human Services this month and has gotten nearly $20 million in federal funding since 2006.
Previously: OK Policy Roundtable: Should the state of Oklahoma be promoting marriage? from The OK Policy Blog
Tax loophole puts Oklahoma cities, towns in tough spot
Municipalities in Oklahoma and across the country are facing more serious budget concerns than have been experienced in recent decades. Unlike in other states, however, cities in Oklahoma are prohibited from using ad valorem taxes — such as the property tax — to fund municipal budgets. This puts Oklahoma in a particularly difficult and unique situation in which municipalities are almost exclusively reliant on sales tax revenue to fund city operations such as the police department, road maintenance, trash disposal and even economic development programs. Sales tax is a historically inconsistent source of revenue. The rise of the Internet marketplace has put cities and towns in Oklahoma in an especially troubling position due to a tax loophole that allows online-only retailers to forgo the collection of sales tax at the point of sale and places the burden of paying that tax on the consumer, who is often unaware that this tax must be claimed and paid on yearly income tax returns.
See also: Oklahoma cities want e-commerce business to collect sales tax from The Norman Transcript; Cities, state take hit in lost revenue due to untaxed online sales from The Muskogee Phoenix; Enid area losing more than $80M a year in tax revenue from Enid News
Oklahoma Supreme Court rules that Tax Commission must reimburse rural school district
The Oklahoma Tax Commission must pay Kiowa County and a rural school district $733,000 in tax reimbursements denied because of a clerical error, the Oklahoma Supreme Court has ruled. Tax Commission spokeswoman Paula Ross said the agency will not challenge the Supreme Court’s unanimous opinion, which was issued Thursday. The commission was following a strict rule in state statute that set a deadline for tax-reimbursement applications. Superintendent Andy Evans learned late last year that because the proper paperwork hadn’t been filed with the Tax Commission, the 250-student Mountain View-Gotebo School District in southwestern Oklahoma stood to lose a quarter of its annual budget. The money at issue, almost three-quarters of a million dollars, is the 2010 property taxes due on a wind-energy farm in Kiowa County.
Mercy Health systems operates as a ‘church’ for tax purposes
Mercy Health, with revenue of nearly $4 billion, could qualify as one of the largest corporations in the St. Louis region. But its owners, with the blessing of the Vatican, prefer to call it a “church,” which helps tremendously come tax time. The system — whose headquarters is located in Chesterfield — operates Mercy Hospital St. Louis in Creve Coeur, along with 27 other hospitals in Oklahoma, Arkansas, Missouri and Kansas. Like other nonprofits, it pays few corporate, income, property, capital gains or sales taxes. Unlike other nonprofits, Mercy claims that — because it’s technically a “corporation within the Catholic Church” — it is exempt from federal requirements that all charities must disclose certain financial data about their operations. For the first time this year, Mercy’s parent company filed a Form 990 with the Internal Revenue Service detailing such information but with the caveat from its lawyers that it filed “voluntarily.”
Read more from St. Louis Today.
EMSA expenditures scrutinized
The city’s ambulance service piled up a $6.6 million cash reserve this year and plans to spend more than half of that in coming years while it gives pay raises to top managers, spends $2.5 million expanding its building and pays more than $80,000 for lobbyists and public relations, a Tulsa World investigation shows. The Emergency Medical Services Authority has also spent funds in past years on items including a $999 Christmas tree, a $3,200 charcoal grill, numerous office chairs costing more than $1,000 apiece and a $9,000 area rug, records show. Millions have been spent on remodeling projects, a landscaped park and a parking lot with decorative brick archways. EMSA is a government agency that manages ambulance services for more than 1 million people in Tulsa, Sand Springs, Jenks and Bixby, as well as Oklahoma City and numerous suburbs in that area.
Read more from The Tulsa World.
State doctors receive millions from pharmaceutical firms
A University of Oklahoma employee, a part-timer at the Tulsa City-County Health Department and a psychiatrist with the Veterans Administration are among doctors in Tulsa County who have accepted payments, meals or educational items from pharmaceutical companies in the past three years, according to a database published by a nonprofit organization. Oklahoma doctors received more than $6.3 million from 12 pharmaceutical companies between 2009 and the second quarter of 2011, although not all companies reported for all quarters. The three employees at public institutions were among those receiving the most money. Under the Affordable Care Act, pharmaceutical and medical device companies will be required to disclose the data beginning in 2013.
Read more from The Tulsa World.
Number of caregivers in Oklahoma grows annually
Whether it’s for a mother with Alzheimer’s disease or a father with inoperable cancer, an estimated 115,000 Oklahomans currently are caregivers to their sick, infirm or dying loved ones and the numbers and societal implications grow annually. Plus, sad realities exist with the terrible trend: those receiving care often aren’t the same individuals they once were. In fact, there are 75,000 Oklahomans with Alzheimer’s disease or related dementias, and that number is projected to increase by at least 5 percent every year for the next 20 years. More than 15 million Americans provide unpaid care for a person with Alzheimer’s disease or another dementia. Some 80 percent of care provided at home is delivered by family caregivers, according to one AARP report. In all, Oklahoma caregivers provide help to a relative or friend worth $6 billion a year.
DHS scrutinized after drug-related child deaths
One in eight confirmed physical child abuse cases last year in Oklahoma were babies born exposed to illicit drugs. Out of 128 cases, at least seven infants died of birth complications and dozens of others were sent home from the hospital with their drug-using mothers, according to a Tulsa World analysis. Several cases in which newborns died after going home with drug-abusing parents have sparked a renewed look at how to handle child safety in those situations. The state needs to collect more accurate data on these births and bolster its child welfare system, said Claudette Selph, a longtime child advocate in Tulsa and commissioner of the Oklahoma Commission on Children and Youth. The commission has noted a lack of consistency by the state Department of Human Services, saying criteria on when to remove an infant or child from the home changes from county to county and worker to worker.
Read more from The Tulsa World.
Quote of the Day
Currently DHS does not have adequate resources and their staff is significantly underpaid. If we move to removing every infant that is born drug positive to illicit substances, we must have well-trained and well-paid staff to help develop plans for the protections of these babies. This is our state, and our children – and we are not doing all we can.
–Claudette Selph, a longtime child advocate and commissioner of the Oklahoma Commission on Children and Youth
Number of the Day
58
Number of USDA certified organic farms in Oklahoma, representing just one half of one percent of the 10,903 certified organic farms in the United States in 2008.
Source: USDA
See previous Numbers of the Day here.
Policy Note
Why the US should spread the wealth
Many economists worry that making societies more equal through income redistribution or other means reduces economic growth. This big trade-off between equality and efficiency, which is supported by comparisons of capitalist and socialist countries, implies that there’s a limit to how much redistribution a society should pursue. However, while the trade-off is quite unfavorable as we push to extremes, recent experience suggests there is a wide region where the trade-off is hard to detect. Thus, worries about this trade-off appear to be overblown. For example, the Bush tax cuts were justified, in part, by the assertion that equity had overshadowed efficiency in tax policy. Accordingly, the lower end of the income distribution would fare much better after income trickled down than it would under redistributive policy. The economy did grow after the Bush tax cuts, but the rate of growth was unremarkable, especially for jobs, and there’s little evidence that they caused large increases in output growth, as promised. In fact, there’s little evidence that the Bush tax cuts had any effect at all. The trade-off simply wasn’t there.
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