Right now Oklahoma is involved in possibly the biggest budget crisis the state has ever seen, to the tune of $1.3 billion. Oklahoma has been hit especially hard amid low oil prices and it’s dependence on the oil and gas industry — something leaders and policy makers are quick to point out.
But one thing they’re not as quick to highlight is this: our “leaders” sold us out. Big Oil threw it’s weight around, lobbied our state legislature (whom we voted in to represent us) for extended/permanent tax breaks, and won at the expense of the individual taxpayer. And at the expense of our schools, our teachers, our kids, and a host of other state-funded agencies.
Oilmen won a big victory when legislators made permanent one of the juiciest tax breaks in the United States. Schools, meanwhile, are having to cut classes, administrators and teachers to make up a growing revenue shortfall”
I say they sold us out because our “leaders” knew that eventually the piper would need to be paid. Oil and gas is cyclical — always has been, always will be. Money Management 101 tells you that you save more during the good years to help pad the lean years. But according to Reuters.com, “over Oklahoma’s boom period, energy production tax revenues fell instead of rising. The opposite happened in North Dakota and Texas, which saw big increases in revenue.”
So just to clarify:
- Oklahoma’s economy is largely dependent on oil and gas
- oil companies were thriving with oil over $100 per barrel for years
- but yet the state’s tax revenue from these companies’ energy production fell over that period
So why did tax revenue fall on the biggest driver of the Oklahoma economy? Click this link to view details about the bill that was signed into law two years ago because “three Oklahoma oil companies warned they might curtail drilling by as much as half if the tax on horizontal wells went back to 7 percent in 2015, as scheduled.” I don’t buy that. Where would they go and pay lower taxes? This was a power move to try and bully our legislature into passing these tax credits…and it worked.
According to this article by Adam Wilmoth in The Oklahoman in 2014, billionaire oilman George Kaiser said, “The net effect of this tax reduction is a subsidy by the taxpayers of Oklahoma and the education system to predominately out-of-state shareholders of Oklahoma companies.” Of the tax credits given to the oil companies, Kaiser, in the same article, went on to say that “…I think it has desperate consequences to the state, which is already suffering an inability to fund state services…”
Fast-forward to 2016, school districts in Oklahoma City have already voted to make $10 million in cuts to funding – with $7 million more needing to be cut. Tulsa has slashed $8 million in funding, and Broken Arrow, Union and Bixby districts have made cuts that also extend into the millions.
[From] 2008 to 2014, Oklahoma’s education spending per pupil fell by 24%, the biggest drop in the country, and that was before the latest round of belt tightening.”
This doesn’t even begin to address the poorer rural districts whose cuts don’t amount to millions, but are still drastically affecting Oklahoma students. Or the number of teachers that have been laid off as a result. Or the fact that the teachers who are still choosing to teach (God bless them) are getting paid 20% below the U.S. national average.
But wait! Our friends at the legislature have proposed some solutions: raise taxes on the individual taxpayer (you and I).
- sales tax increase from 4.5% to 4.9%
- $1.50 tax per pack on cigarettes
- $.03 per gallon tax on a gallon of gas (this ended up not passing)
The very people we elected into office to uphold our best interests have failed us. They have failed our kids. They have failed our teachers. They have failed anyone who pays taxes in this state with their misappropriations of funds and tax breaks for Big Oil.
I understand that oil and gas is the biggest driver of Oklahoma’s economy. I understand and appreciate all of the wonderful things these companies do for our communities. I actually work in the oil and gas industry — so trust me — I get it.
But maybe it’s time to explore our options with other industries within the state so that we’re not solely dependent on oil and gas. Maybe it’s time we vote some of these elected officials out of office who don’t hold our best interests in mind. Maybe it’s time to voice our displeasure with their political BS and selfish lobbying.
You can find a list of your local representatives here.