The legislative session is over and it was a difficult one to say the least. We had $1.3 billion less to formulate a budget for the state. Many long days and nights on the floor and in committee characterized the last 4 months.
As Winston Churchill once said, “Never let a good crisis go to waste.” Oklahoma needs to heed that message.
First and foremost, we need to reform our recurring revenue sources – on how they are collected and forecasted – so we know what we have to work with. These include such items as sales taxes, corporate and individual income taxes, gross production taxes, vehicle taxes, etc.
Frankly the state has done a lousy job of budget forecasting. Everyone knows it – “like the emperor has no clothes.”
If you were working at a company and were almost 20 percent off in your estimates, you’d be fired.
So this session, Sen. Mike Mazzei and I got together to get Senate Bill 1030 passed. It provides a 3-year forecast and risk management process to occur in our budget estimates. State agencies now will be required to submit their multi-year collections, capital needs and itemized budgets to the Tax Commission, OMES and Budget and Appropriations committees.
Businesses operate this way. It’s almost criminal that Oklahoma has been operating on a yearly forecasting cycle and has been expecting good fiscal data.
The recurring revenue problem however just can’t be solved merely with better forecasting and transparency. We have to change the way Oklahoma does business.
First and foremost, we have to break the addiction to tax credits that rob the state coffers from revenues they rightfully should receive. It amounts to hundreds of millions of dollars less every year that we have to work with.
We also need to stop picking winners and losers and let every business stand on their own merit.
If your industry or business is not having a demonstrated Cost Benefit Analysis or Return on Investment to Oklahoma, you need to stop having the taxpayer support your” government welfare” payments. Also, tax credits should be capped and sunset. They were not meant to last forever. We had several tax credits this year that we cut that had been in place for almost 3 decades. One that was set up back in the 1970s during the Carter Administration.
Folks, a “hand up was never meant to be a hand out.” Oklahoma needs to stop relying on “one-time revenue sources” to fill budget holes.
Borrowing from our roads and bridges year after year doesn’t help. We are draining any cash reserves we have and driving up our debt. It’s well past time to fix the problem so we can have more revenue to work with during these crisis times with destabilizing factors and uncertainty. This should drive us to financial solutions that benefit all Oklahomans.
We all would do well listening a little more to the taxpayer and a little less to the special interests.