Budget & Tax

State policy rankings show where Oklahoma can improve

July 5, 2017

Curtis Shelton

The interim between legislative sessions offers the opportunity to step back and consider the long-term policy direction of our state. The American Legislative Exchange Council (ALEC) launched a helpful website this year to complement its yearly print publication, Rich States, Poor States, which compares states according to 15 policy variables. These include tax rates, regulatory burdens, and labor policies. An overall ranking is created by compiling the 15 variables and using a weighted average of each variable to determine an overall ranking.

Oklahoma ranks 16th this year, down from 10th last year. This is mostly because other states have improved their policies. As the list shows below, Oklahoma had very little movement in nearly all the variables ALEC uses.

Source: http://www.richstatespoorstates.org/states/OK/

As you can see from the list, Oklahoma only saw a large move in one variable, recently legislated tax changes. This measures the relative change in a state’s tax burden over a two year period. Oklahoma’s sales tax burden remains heavier than most states, which may help explain why voters resoundingly defeated State Question 779. And while our workers’ compensation costs are declining, they remain among the most expensive in the nation. Perhaps most unexpected for those who believe Oklahoma is a “small government” state is the higher-than-average number of government employees relative to the size of our state’s population. Given all these areas where we can improve, Oklahoma could easily return to the top 10 if state policymakers pursue pro-growth policies and a level playing field for all Oklahomans.