What’s up this week at Oklahoma Policy Institute? The Weekly Wonk shares our most recent publications and other resources to help you stay informed about Oklahoma. Numbers of the Day and Policy Notes are from our daily news briefing, In The Know. Click here to subscribe to In The Know.
This Week from OK Policy
- Increasing economic security in Oklahoma can strengthen families, assist in child abuse prevention (Child Abuse Prevention Month): When it comes to providing meaningful solutions to stopping child maltreatment, Oklahoma should focus on addressing poverty, which is intrinsically linked with child maltreatment, particularly neglect. If Oklahoma leaders really want to make children a priority in this state, then improving economic stability for their families is the first step. [Gabrielle Jacobi / OK Policy]
- Oklahoma should work towards true housing equity: Fifty-four years ago this month, President Lyndon Johnson signed the Fair Housing Act to prohibit discrimination in housing because of race, national origin, religion, or sex (including gender identity and sexual orientation). In 1988, the law was expanded to prohibit discrimination based on disability and familial status (pregnant women or the presence of a child under 18). Even with this federal legislation, racial disparities in housing still exist. [Sabine Brown / OK Policy]
- HB 1933 attacks an indispensable support to our workforce: Oklahoma’s lawmakers should recognize the importance of a well-designed unemployment insurance program and strengthen this necessary program rather than undermine it. Unfortunately, a piece of legislation recently passed by the state House of Representatives and passed by the Senate threatens the efficacy of our state’s unemployment insurance program. House Bill 1933 — which would drastically reduce the length of time laid-off workers may draw unemployment benefits — would weaken our economy, threaten families’ financial security, and fail to get more Oklahomans back to work. [Josie Phillips / OK Policy]
- Risk assessment tool needs to be carefully crafted to best serve justice-involved youth (Capitol Update): Senate Bill 1282, presented on the House floor last week, requires a risk-assessment screening tool approved by the Office of Juvenile Affairs (OJA) to be used when a child is taken into custody pursuant to the Oklahoma Juvenile Code, to help determine if the child should be detained. The bill exposed a usually unnoticed conflict. Risk-assessment screening tools are controversial. Who knew? [Steve Lewis / OK Policy]
- Policy Matters: Reclaiming our political voice: We often refer to our capitol buildings as “the people’s house” as a sign these buildings don’t belong to a single person or elected official. Rather, these buildings belong to all of us, and everyone should have equal access to our elected officials. Despite this, far too few of us exercise our political voices to influence state laws and policies. For most Oklahomans, our halls of power – and the levers to create change – seem distant and difficult to navigate. [Ahniwake Rose / The Journal Record]
- Viewpoint: Tax cuts’ drain on revenues would stifle Oklahoma’s economic growth: Bills the Oklahoma House has passed to cut corporate and individual taxes wouldn’t boost state economic growth or stimulate new business investment as intended. Even if lower taxes were the economic driver the bills’ authors seem to think they are, the state is already well situated from that perspective, and it’s likelier the bills’ drain on revenues would harm Oklahoma’s schools, services and workforce quality and thereby discourage investment. [Emma Morris and Michael Mazerov / The Oklahoman]
Together OK’s Day of Action will be held on Monday, May 2, 2022, on the second floor rotunda of the Oklahoma State Capitol in Oklahoma City. The free event will begin at 11 a.m. with a short program, including brief remarks and a Legislative update from Oklahoma Policy Institute staff. Check-in will begin at 10 a.m. During the event, attendees will receive resources to help make effective contact with lawmakers. In addition to sharing tools and resources, Together Oklahoma will also assist in scheduling appointments with legislators to spark conversations. [Register Today]
Weekly What’s That
A committee substitute is a revised version of legislation proposed for consideration and adoption by a committee. The committee substitute replaces, in whole, the original bill that was referred to a committee, including conference committees.
It is quite common for the language of a committee substitute to be entirely different from previous versions of a bill, especially in the House of Representatives when a bill is introduced as a shell bill. The House and Senate each have rules specifying when and how a committee substitute may be introduced.
Quote of the Week
“Approximately six in 10 of the minimum wage workers in the state are women. So, this gender earnings gap is something that’s concerning, and it seems it be, unfortunately, kind of getting worse.”
– Laura Ahlstrom, economic professor at OSU and lead researcher on a new study that found that if current wage gap trends continue in Oklahoma, women will not receive equal pay until 2076. [KOSU]
Editorial of the Week
With nearly $700 million committed to landing factory, now isn’t the time for tax cuts
With the passage of a $698 million incentive designed to lure a major manufacturer to northeastern Oklahoma, some lawmakers are rightly concerned that now is not the right time for tax cuts.
Legislators are considering at least $557 million in various tax cuts this session, prompted by rising state revenues and an influx of federal relief funds that have stuffed Oklahoma’s treasury with cash.
But some legislative leaders have been hesitant to move on tax cuts, given what has happened in Oklahoma when tax cuts, combined with economic downturns, have created damaging fiscal crises.
“I have been against tax cuts all year,” said Senate Appropriations Committee Chairman Roger Thompson, R-Okemah. “I personally don’t think we could move forward with any tax cuts while we are moving $698 million into a rebate package.”
House Appropriations and Budget Committee Chairman Kevin Wallace has expressed similar reservations in the past. There are good reasons to be wary.
First off, the substantial funds in the state’s savings are partially filled with nonrecurring federal funds. There is no source that will replenish these funds once they’re spent.
Secondly, tax cuts are notoriously difficult to reclaim. State Question 640, approved by voters in 1992, requires an unusually large majority of the Legislature to pass tax increases. It’s either that or a majority vote of the people.
Only one time — in 2018 — has the Legislature approved a tax increase since SQ 640 was passed, and it did so only under extreme pressure due to statewide teacher walkouts. For all practical purposes, once a tax cut is enacted, it’s revenue that’s gone for good.
Thirdly, veteran lawmakers understand how quickly reserve funds can disappear. Substantial state savings evaporated during lean times caused by last decade’s oil crash, followed by the economic fallout from the early days of the COVID-19 pandemic.
Should Oklahoma land the deal to have a company build a factory in Pryor, money for the incentives will come from the state’s reserve funds.Oklahoma’s economy is doing well at the moment, but Thompson — a conservative on fiscal matters — noted that headwinds are here. Inflation remains stubbornly high, and that plus other economic uncertainties could sour the state’s economic fortunes.
In that scenario, falling revenues would be choked further by tax cuts now being proposed.
Oklahoma already has one of the country’s lightest tax burdens, so the rush for tax relief is one of choice and not necessity. With the state committing so heavily on landing a major employer, that’s one more reason to be wise with the funds the treasury has on hand as well as the revenue it hopes to collect in the future.The temptation to bring tax cuts to the state’s voters might be strong in an election year, but lawmakers should instead be prudent and shelve such proposals this session.
Numbers of the Day
- 596,705 – Average number of Oklahomans receiving SNAP benefits (food security) each month in FY 2020. [Center on Budget and Policy Priorities]
- 101,000 – Number of Oklahomans lifted out of poverty by SNAP between 2013 and 2017. [Center on Budget and Policy Priorities]
- 47,000 – Number of Oklahoman children lifted out of poverty by SNAP between 2013 and 2017. [Center on Budget and Policy Priorities]
- 97,357 – Number of Oklahomans living in households receiving federal rental assistance. [Center on Budget and Policy Priorities]
- 1 in 3 – More than 1 in 3 households receiving federal rent assistance have children in the household. [Center on Budget and Policy Priorities]
What We’re Reading
- Does the Safety Net Help Prevent Family and Youth Violence? [Econfact]
- Building a Better Social Safety Net [Georgetown University Beeck Center for Social Impact and Innovation]
- The social insurance system in the US: Policies to protect workers and families [Brookings]
- Unemployment Insurance: Economic Lessons from the Last Two Recessions [Federal Reserve Bank of Richmond]
- How Weak Safety Net Policies Exacerbate Regional and Racial Inequality [Center for American Progress]