Keating Tax Program Would Cut Education by $599 million, Discourage New Business, Investment in Oklahoma

Oklahoma's education system would bear the brunt of Governor Keating's income tax cut program, losing an estimated $599 million annually if the tax reduction is fully implemented, according to a Senate analysis of the Governor's program.

Governor Keating has proposed that the state income tax rate be reduced from 6.75% to 3.75% -- a cut that would ultimately slice $1.1 billion out of the state budget.

"Whenever Governor Keating says he wants to cut taxes, he's also saying that he wants to cut funding for our public school classrooms because that's where the lion's share of state money goes. We already rank in the bottom 10 nationally for education funding, but if Governor Keating implements his program, he'll drive us to dead last. That's a terrible signal to send to all of the new industries that are seeking states with highly educated workforces to fill their jobs," said Senator Cal Hobson, chairman of the Senate Appropriations Subcommittee on Education.

According to the Senate analysis, because the three major branches of education received 54% of the state budget this fiscal year, they would lose the largest amount of future revenue - some $599 million each year under the Keating program.

"We can't even fund our education system with the money we have, but Governor Keating still wants to slice a big chunk out of their piece of the budget pie. I know the Governor likes to give lip service to a strong education system, but you can't have top notch public schools if you're
consistently whacking away at their resources," said Senator Hobson.

According to the Senate analysis, state programs would stand to lose the following amounts of money if the Governor's income tax cut is fully implemented.

• Education -- $599 million
  (K-12 education -- $405.3 million)
  (Higher education -- $167.8 million)
  (Career Technology -- $ 25.7 million)
  
  
• Corrections -- $75 million;
  
  
• Veterans -- $4.7 million;
  
  
• REAP -- $3.2 million;
  
  
• Dept. of Human Services -- $79.4 million; and
  
  
• Mental Health -- $28.3 million

"When you carve away almost a quarter of the state budget, everyone takes it on the chin - schools, veterans, rural communities, mental health centers - you name it. If Governor Keating wants to get accolades from his millionaire friends for reducing taxes, he also has to accept the blame for cutting funding for education, veterans and a host of other important
programs that people rely on," said Senator Hobson.

The Senate budget leader noted that recent public opinion polls have shown that Oklahomans care more about improving education than tax cuts - a finding Governor Keating has apparently ignored. For example, a state poll conducted by the Oklahoma Commission on Education Administration in September showed that 60 percent of Oklahomans wanted to spend state growth revenue on public education while only 25 percent favored tax cuts.

"When he picks tax cuts over education, I think Governor Keating illustrates just how far out of step he is with the average Oklahoman. The people want good schools and well-equipped classrooms, not a tax program that drains money from public education to reward an elite few. Certainly, everyone would like to have tax relief, but not if you have to squeeze the money out of the public schools and state universities to deliver it," said Senator Hobson.

Because Governor Keating has phased in his tax cut program over several years, the bulk of the revenue loss won't be felt until after he leaves office. That will leave future leaders with many difficult budget problems but very little funding to meet them, according to Senator Hobson.

"He's leaving a budget mess for future generations to clean up. If he gets his way, Governor Keating's legacy will be a mountain of debt, an underfunded education system and a shrunken state treasury. It's the kind of scorched earth budget policy that might bring him some short-term political benefits, but in the long run, it will devastate our state," said
Senator Hobson.