4/18/2012 Legislative Update

Post date: Apr 19, 2012 3:51:59 AM

Legislature Continues Drive to Cut School Funding Base

The Republican-led drive to cut state income taxes, which will undermine the funding base for Oklahoma schools and other state services, continues. It is appalling that after years of massive funding cuts, which forced our district to lay off dozens of teachers and close Oak Park school, the legislature is still voting to cut taxes.

The governor and many legislators seem sold on the Laffer economic theory that cutting income taxes will actually increase tax revenues. Local retired science teacher Lynne Shaw exposed in a Tulsa World article the flawed research behind this thinking.

Between 2004 and 2006 the top rate for the state income tax was cut from 6.65 percent to 5.5 percent. Those cuts cost the state $777 million in 2010, more than the entire $500 million funding shortfall for fiscal year 2012. But in the 2011 session the legislature only compounded the problem by cutting taxes again, down to 5.25 percent. So even with a recovering economy, school funding for the coming school year is expected to be flat at best.

The latest bill passed by the Senate would cut the maximum income tax rate from 5.25 percent to 4.95 percent. That would cost the state $56 million in FY 2013 and $144 million in FY 2014. Worse, the bill includes triggers to drop the tax rate by 0.25 percent when the state experiences 5 percent revenue growth in sales, use, motor vehicle and corporate income taxes.

Legislators often cite the lack of income tax in Texas, ignoring how its property taxes are more than double the rate in Oklahoma and carefully never mentioning its higher corporate taxes. Consider the graphic below, showing the tax bases for Oklahoma and Texas compared to the other states, and how eliminating income tax would wipe out much of our tax base:

Ford's Deregulation Bill Dies in House Committee

Senate Bill 1530, which would have allowed local school boards to be exempted from most state mandates, including collective bargaining, is dead for the session. Although it passed the Senate, it failed in the House Appropriations and Budget Committee's Education Subcommittee. The bill would have placed basic teacher rights, ranging from planning periods to the length of the school year and school day to various forms of leave, at risk.

Senate Bill 1879 on National Board Certification Bonuses Amended

FUNDING SECURED FOR 2011-2012 NATIONAL BOARD BONUSES, BUT NOT YET HERE

The governor has already signed Senate Bill 1959, co-sponsored by Earl Sears, which thankfully provided $37.6 million to fund teacher and support personnel health benefits for the current fiscal year and $14.8 million to fund the 2011-2012 $5,000 stipends for National Board Certified teachers. (Although over a month later the state department of education has yet to get that funding to districts and thus into the teachers' hands.) However, that bill provided no funding for the National Board bonuses in future years.

BILL FUNDS REMAINING PROMISED BONUSES & PERFORMANCE PAY LANGUAGE IS GONE

Senate Bill 1879 provides funding for National Board Certification bonuses, fees, and scholarships for those who have already earned it and had been promised $5,000 for the ten-year duration of the certification. But the bill originally phased out that funding over time in favor of performance pay based on the forthcoming TLE appraisal system. A House panel voted to strip that language from the bill.

As it stands, the measure extends a maximum of ten bonuses to those teachers who were eligible for the bonus before the moratorium went into effect for FY-11 and FY-12. As the program currently receives $0 funding from the State Board of Education, removing contingency funding language will require the Board to pay $14,845,700 in bonuses for FY-13 for all eligible teachers, school psychologists and audiologists. This amount will gradually decrease as bonus recipients phase out of the program over the next decade.

BILL PROVIDES SCHOLARSHIPS TO SUCCESSFUL FUTURE APPLICANTS, BUT DOES NOT FUND ANNUAL BONUSES FOR THEM

The measure also provides for payment of application fees and scholarship awards for up to 100 program applicants each year through the Commission for Teacher Preparation, at a cost of $3,250 per applicant ($2,750 for the application charge/assessment fee, $500 for other associated expenses), for a total of $325,000. So while teachers seeking National Board Certification in coming years might receive some scholarship support if they are successful in obtaining the certification, and while they would be eligible for $5,000 annual bonuses, the bill does NOT provide funding for such annual bonuses for newly certified teachers.