With just over a week until the end of the regular legislative session, some lawmakers have proposed massive tax increases, including a plan to cap personal itemized deductions that would dramatically increase personal income taxes on many Oklahoma families and small businesses.

OCPA released today a budget plan to fill Oklahoma’s $878 million budget gap and give teachers a pay raise—while respecting and protecting Oklahoma families and their own budgets.

The balanced budget plan proposed by OCPA includes more than $1.3 billion in savings—including items from OCPA’s “Freedom Agenda” published in January and “First Steps” list released in February—and $337 million in tax increases, including an increase in the tax on gasoline and diesel, a 67-cent per pack cigarette tax increase, and a wind production tax. Together, the lower spending and increased taxes add up to nearly $1.7 billion.

This budget plan would fully fund a $1,000 teacher pay raise for K-12 public school teachers as well as the elimination of personal income tax for classroom teachers. Base pay and income tax are the main reasons cited by teachers that leave Oklahoma for states like Texas.

OCPA PROPOSED LIST OF REFORMS

(Download PDF, includes additional information on each item)

Non-Tax Increase Items
Medicaid enrollment audits -- HB 1270	$85.6 million Annual
HealthChoice enrollment audits	$6.0 million Annual
HealthChoice select provider reform; capture savings, or equivalent amount, for General Revenue Fund	$65.0 million Annual
3-year moratorium on agency “swag,” advertising, memberships, sponsorships, and non-critical travel	$39.0 million Annual
End zero emission tax credit effective for any new projects or turbines; effective July 1, 2017	$15.0 million Annual
Cap zero emission tax credit liability payout at $12.5 million annually; effective July 1, 2017	$52.5 million Annual
Cap ad valorem reimbursement for wind at $12.5 million annually; effective July 1, 2017	$17.5 million Annual
Repeal sales tax exemption on wind turbine sales; effective July 1, 2017	$40.0 million Annual
Tobacco settlement reforms	$57.0 million Annual
Consolidation of administrative and back office functions of higher education, bringing number of non-instructional workers in Oklahoma's public higher education system more in line with the national average (reduction of 33 percent)	$124.5 million Annual
Increase efficiency of underperforming professors	$182.3 million Annual
Eliminate sales tax exemption for state government agencies; excluding PreK-12th Grade public education -- (no funding required to cover the cost of the sales tax as this will require agencies to make the same cost benefit decisions as many non-profits and private sector business.)	$95.0 million Annual
Career Tech, utilize building funds, and recurring surpluses in reserve funds	$3.0 million Annual
Eliminate Hollywood Subsidy	$5.0 million Annual
Eliminate cigarette sales and tobacco products sales rebate to tribal governments	$60.0 million Annual
Annual CIRB Apportionment Reduction	$30.0 million Annual
Surplus Cash Withdrawal from CIRB Fund	$102.7 million One-time
Revolving funds	$50.0 million One-time
Rainy Day Fund	$150.0 million One-time
Set dedicated funding at the Actuarily Determined Contribution for the Teacher Retirement System at $300 million for FY 2018 only	$15.0 million One-time
3-Year moratorium on Rural Economic Action Plan	$9.6 million Annual
3-Year Delay in ROADS Fund Increase	$50.0 million Annual
3-Year Moratorium On COGS Administrative Operational Grants	$0.2 million Annual
3-Year Moratorium On Tourism Country Advertising Grants	$0.7 million Annual
Convert Horse Racing Commission to Non-Appropriated Agency	$1.7 million Annual
Convert Spaceport Authority to Non-Appropriated Agency	$0.3 million Annual
Convert OETA to Non-Appropriated Agency	$2.8 million Annual
Convert JM Davis to Non-Appropriated Agency	$0.2 million Annual
Consolidation of administrative and back office functions Oklahoma Conservation Commission reduce from 88 to 77	$0.8 million Annual
Adjust horse racing gaming tax rate to Illinois Rate 34%	$10.3 million Annual
Increase exclusivity fee for Class III gaming to 10%	$10.4 million Annual
Increased 1017 Fund deposits, due to increase of exclusivity fee for Class III gaming - 10%	$76.9 million Annual
Total Non-Tax Increase items	$1,359.0 million
Tax Increase Items
Gasoline/Diesel Tax	$219.7 million Annual
$0.67 Cigarette Tax Increase	$80.8 million Annual
Wind Production Tax	$36.6 million Annual
Total Tax Increase items	$337.1 million
Grand Total	$1,696.2 million