Funding rhetoric is at odds with reality

THE gap between financial reality and Democratic rhetoric is growing wider by the day. But ignoring math facts does Oklahomans no good.

The state Supreme Court gave the green light this week to an initiative petition effort seeking to raise the gross production tax from 2 percent to 7 percent on all wells. Backers say the tax increase will generate an additional $340 million annually and a portion will be earmarked for a $4,000 teacher pay raise.

House Democrats hailed the proposal. Rep. Eric Proctor, D-Tulsa, said, “Restoring the gross production tax isn’t about punishing oil and gas. This is about restoring funding to rural health care so we can stop the closure of rural hospitals. This is about ensuring teachers in Oklahoma don’t have to take multiple jobs to provide for their family. This is about the Department of Corrections being able to hire more correctional officers so prisons are adequately staffed.”

Then, the news release abruptly conceded, “Although restoring the gross production tax doesn’t bring in enough revenue by itself to shore up the state’s financial woes, it does provide a key element to a revenue package that could.”

Why did Democrats feel compelled to immediately walk back their promises of massive spending increases if the gross production tax is boosted? Because the tax increase, while substantial, is still a far smaller amount than the spending increases Democrats and some activists desire.

The Oklahoma Education Association has demanded $1.4 billion in increased annual government spending within three years, and threatens a teacher walkout if that money isn’t provided. The OEA is demanding money for teacher raises, school support staff raises, general school funding increases, pay raises for state employees at all agencies (not just education), and increased spending on government health care programs.

Needless to say, a $340 million annual increase in gross production tax is nowhere near enough to fund that wish list. In fact, it’s not enough to even fund the teacher pay component.

The OEA wants $10,000 in teacher pay raises over three years with a first-step raise of $6,000 this year. Paying for a $6,000 raise will cost $366 million. And, again, raising the GPT to 7 percent generates only $340 million. So the gross production tax increase won’t even cover the initial cost of the OEA’s teacher pay demands, let along the total three-year cost of a $10,000 raise, or the cost of a support staff raise, or the cost of increased school funding.

And it certainly doesn’t generate enough to meet all the OEA’s education-related funding demands and provide more money for rural hospitals and correctional officers, as House Democrats suggest in their release.

This isn’t the first time Democrats have overstated the healing qualities of the gross production tax. In 2016, the House Democratic caucus leader said the GPT would produce $180 million for every 1 percentage point added to the rate. That translated into $900 million at a 7 percent rate, yet the real estimate is $340 million today.

Rather than mislead Oklahomans, state budget writers must be honest with the public and use real numbers and valid estimates. Voters should not only ignore, but replace, any lawmaker irresponsible enough to argue otherwise.