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Law & Principles

Jonathan Small | January 29, 2018

Know the facts on SQ 640

Jonathan Small

This article was published in OCPA's Perspective magazine View Issue

Some Oklahoma lawmakers are looking to wage war against SQ 640, claiming it confines government by making any revenue-raising measures impossible to pass. But that’s not true.

If you want to regulate speech, you belittle the First Amendment. If you want to confiscate guns, you vilify the Second Amendment.

In Oklahoma, if you want to reach into taxpayers’ wallets for more cash, you denounce the constitutional protections established by State Question 640, which was approved by voters in 1992.

In case some forgot, 640 is that annoying rule on revenue-raising measures. With it, voters took back some of their power. The measure first calls for Oklahoma voter approval on tax increases. Or, alternatively, the Legislature could pass tax increases with a supermajority of at least 75 percent in each chamber.

For working Oklahoma families, 640 offers some protection from the threat of constant tax increases. Before it passed, simple majorities easily raised taxes without concern for Oklahoma’s economy. For example, House Bill 1017 passed in 1990, which raised taxes by more than $200 million.

If history doesn’t necessarily repeat itself, it echoes. Look at where we are today. We have a downturn in Oklahoma’s oil and gas economy, and a state government frantically searching for more than $200 million to spend instead of making tough choices.

As you might expect, some lawmakers are now looking to wage war against 640. They claim it confines government by making any revenue-raising measures impossible to pass. But that’s not true.

In 2009, 2010, and 2011, legislators organized bipartisan supermajorities to pass bills that raised some $224 million in new annual state funds and $268 million in annual matching federal dollars.

Press releases from the executive branch, Board of Equalization reports, and legislative budget summaries show that the 2015, 2016, and 2017 legislative sessions combined to annually increase revenue for appropriation by more than $500 million.

Moreover, Oklahoma has raised personal income tax rates, cigarette taxes, gaming taxes, and authorized a state lottery (a tax on the poor) since 640 was adopted by voters.

So mostly during Republican majority control, annually recurring revenues were raised more than $724.7 million.

Oklahoma’s budget issues stem from two causes—an extended recession that hit the oil and gas industry and the failure to address the inefficient structure of government. When times are tough, state government must do everything possible to adjust spending to match income, just like the rest of us.
When we easily give government more money, it finds a way to quickly spend it. Then, it returns next year asking for more.

Oklahoma taxpayers are grateful to have 640 in the books. Lawmakers should respect taxpayers instead of waging war against 640.

Jonathan Small President

Jonathan Small

President

Jonathan Small, C.P.A., serves as President and joined the staff in December of 2010. Previously, Jonathan served as a budget analyst for the Oklahoma Office of State Finance, as a fiscal policy analyst and research analyst for the Oklahoma House of Representatives, and as director of government affairs for the Oklahoma Insurance Department. Small’s work includes co-authoring “Economics 101” with Dr. Arthur Laffer and Dr. Wayne Winegarden, and his policy expertise has been referenced by The Oklahoman, the Tulsa World, National Review, the L.A. Times, The Hill, the Wall Street Journal and the Huffington Post. His weekly column “Free Market Friday” is published by the Journal Record and syndicated in 27 markets. A recipient of the American Legislative Exchange Council’s prestigious Private Sector Member of the Year award, Small is nationally recognized for his work to promote free markets, limited government and innovative public policy reforms. Jonathan holds a B.A. in Accounting from the University of Central Oklahoma and is a Certified Public Accountant.

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