In The Know: Still-declining revenue forces deeper cuts to state agencies starting in March

In The Know is your daily briefing on Oklahoma policy-related news. Inclusion of a story does not necessarily mean endorsement by the Oklahoma Policy Institute. Click here to subscribe to In The Know and see past editions.

Today In The News

Still-declining revenue forces deeper cuts to state agencies starting in March: State agencies were notified Monday that declining state revenues will result in deeper cuts than originally expected. “As you are aware, a revenue failure has already been declared and monthly general revenue allocations to agencies were reduced by three percent for the remainder of fiscal year 2016 beginning in January,” Finance Secretary Preston Doerflinger said in an email to agency directors and finance officers. “Please be advised that the three percent reduction to monthly general revenue allocations must be deepened beginning in March” [Tulsa World]. A mid-year revenue failure was declared in January [OK Policy].

Lost storefronts, local taxes and the clicking explosion: Oklahoma is a red state again, but this time it’s something much different than partisan politics. And potentially much more devastating. According to a recently released study from Civic Economics and the American Booksellers Association, the red shows how Amazon has negatively affected Oklahoma and other states in lost sales tax and overall tax revenue. If you want to look beyond the oil industry downtown, you might find how Amazon and other online retailers are potentially creating more turmoil than imagined [Joe Hight / Journal Record]. Read the full report: Amazon and Empty Storefronts.

Oil plunge threatens schools, other services in US producer states: From Alaska to Oklahoma, crowded classes, suspended art programs and longer school commutes give students and parents a taste of the downside of cheap gas as oil-producing states scramble to plug budget holes blown by tumbling crude prices. Spending on education, healthcare and other services is either being cut or faces cutbacks in about half a dozen states that have relied on oil taxes for a sizeable part of their revenues and most did not prepare for oil diving as deep as $30 a barrel [Reuters]. The state budget deficit is not just oil prices [OK Policy].

Committee takes initial steps on tax reform amid revenue failure: One day after officials announced Oklahoma’s state revenue failure had become more pronounced, a legislative committee took some initial steps on Tuesday to trim tax breaks. Senate Finance Committee Chairman Mike Mazzei said the panel passed a wide array of bills on tax incentives, so lawmakers have a range of choices when they later consider which credits, exemptions and deductions might be eliminated or reduced. The committee approved Senate Bill 977 by Mazzei, R-Tulsa, to suspend nearly two dozen tax credits for two years, but he said the measure would not be considered in its current form by the full Senate [NewsOK].

What’s driving Oklahoma’s prison population growth?: With criminal justice reform again on the agenda in 2016, it is important to understand what is behind the growth in the prison population. A review of the report that provided the foundation for Oklahoma’s 2012 effort at criminal justice reform, the Justice Reinvestment Initiative, provides some important insights into what is needed to cut incarceration rates – and challenges some common misconceptions [OK Policy].

Prison reform plan would give low-level offenders a ‘second chance‘: A newly formed coalition dedicated to reforming Oklahoma’s criminal justice system launched a ballot initiative Wednesday for a public vote on policies to reduce the state’s high prison population. Oklahomans for Criminal Justice Reform — a bipartisan group of legislators, criminal justice experts, and business and faith leaders — filed paperwork for two proposed state questions. One would reclassify several low-level offenses, like drug and property crimes, to misdemeanors. A second would invest the resulting cost savings into rehabilitation programs to treat substance abuse and mental health problems [KOCO].

School bond issues pass with overwhelming support; Decker keeps Tulsa school board seat: Tulsa County voters approved more than $180 million worth of school bond issues Tuesday, with Bixby Public Schools scoring big with its $142.4 million package. The Bixby package — the largest in the district’s history — was divided into two parts, with each being approved by about 80 percent of voters. Also on Tuesday, Tulsa Public Schools’ voters elected Cindy Decker to fill the District 5 school board seat. Decker has held the seat since May, when she was appointed to fill the remainder of an unexpired term after former board member Leigh Goodson resigned [Tulsa World].

Legislative nonsense: midweek edition: A House subcommittee plans to hear HB 3154, which would force school districts to divert health insurance costs to salary. We would call it a pay raise. It’s not. Several people have already heeded the alert from CCOSA and other groups to call the subcommittee members and insist they kill the bill. Here’s the short version of what the bill would do [okeducationtruths].

Expert’s critique of OK education standards is worth noting: In 2014, the Legislature repealed Common Core academic standards in Oklahoma. State officials have since worked to develop a replacement set of standards for English language arts and math, which received approval from the state Board of Education. Now the Legislature has to sign off on them. But the new standards aren’t dramatically different than the repealed Common Core standards, according to one expert. It will be interesting to see if legislators who previously decried Common Core as an apocalyptic federal takeover now embrace what they previously claimed to abhor [Oklahoman Editorial Board].

Senate panel kills bill that would allow use of religion to discriminate: A Senate panel on Tuesday killed a measure that would have allowed religion to be used as justification for discrimination. Senate Bill 1328 by Sen. Joseph Silk, R-Broken Bow, failed the Senate Judiciary Committee by a vote of 4-5. Members of the LGBT community sought to have the measure killed. Dubbed the “Oklahoma Right of Conscience Act,” the measure would have let individuals refuse service based on religious beliefs or conscience concerning marriage, lifestyle or behavior [Tulsa World].

Former Seismologist: Reluctance to Act on Earthquake Science Was ‘Ingrained’ at State Agency: A former research seismologist with the Oklahoma Geological Survey says agency leaders and other state officials fostered a culture of hesitation and reluctance to act on science suggesting the state’s earthquake boom was linked to oil and gas activities. In an interview with Union of Concerned Scientists writer Pamela Worth published Tuesday on The Huffington Post, Amberlee Darold, who left the OGS to take a job at the U.S. Geological Survey, says she was “surprised” by the silence from state officials [StateImpact].

Oklahoma Applies Behavioral Economics to Child Care: In Oklahoma, about 39,000 households receive government subsidies to pay for child care. Surprisingly, about two-thirds don’t renew their benefits on time. It creates added work for everyone — from the caseworker, who has to re-interview and reverify the parents’ eligibility, to the child care provider, who can experience an interruption in payment. So a couple of years ago, the Oklahoma Department of Human Services decided to do something about it. They partnered with MDRC, a social policy research organization and a federal contractor, to try three “nudge” experiments, or small interventions that can encourage people to make better decisions [Governing].

Quote of the Day

“We’re running a factory to create future felons. It’s ridiculous. The image that we create nationally — we’re viewed as being mean-spirited, poor, ignorant, and very, very backward. That’s not who we really are.”

-Gene Rainbolt, chairman of BancFirst Corp., on his support for the ballot initiative proposed by Oklahomans for Criminal Justice Reform (Source)

Number of the Day

$45 million

Estimated sales tax revenue lost by Oklahoma state and local governments to online retail sales by Amazon in 2014

Source: Civic Economics

See previous Numbers of the Day here.

Policy Note

How to Fix the Country’s Failing Schools. And How Not To: A quarter-century ago, Newark and nearby Union City epitomized the failure of American urban school systems. Students, mostly poor minority and immigrant children, were performing abysmally. Graduation rates were low. Plagued by corruption and cronyism, both districts had a revolving door of superintendents. New Jersey officials threatened to take over Union City’s schools in 1989 but gave them a one-year reprieve instead. Six years later, state education officials, decrying the gross mismanagement of the Newark schools, seized control there [New York Times].

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