A tag reduction bill advocated by Governor Keating and Republican legislators would hit education hardest, delivering an annual cut ranging from $76 million to $84 million to public school budgets, according to a Senate budget leader who is advocating a more responsible tag cut. The Governor and minority party members are pushing a tag bill that would cut $139 million out of the state budget pie, the largest slice of which is reserved for education.
"The plan advocated by Governor Keating and his supporters would drain millions of dollars out of our public schools. Given the fact that we rank in the bottom 10 in education funding, we should be working to get more money into our schools, not devising ways to cut their share of the budget
pie even further," said Senator Cal Hobson, chair of the Senate Appropriations Subcommittee on Education.
"Everyone wants to reduce the cost of car tags, but the key is to do it responsibly without hurting education, road construction or a number of other vital services. The Republican program doesn't do that."
Currently, vehicle revenues are earmarked for several areas including public school districts and county roads. If the Republican tag bill was implemented in its current form, the following entities would lose a substantial amount of the vehicle revenue they receive each year.Recipients of Vehicle Funds+ % Share Funds Lost to GOP Tag Bill Gen. Revenue Fund* 46.67% $64.9 million School Districts 35.0% $48.7 million County Highway Fund 7.0% $ 9.7 million County Road Fund 3.5% $ 4.9 million Cities and Towns 3.0% $ 4.2 million County Matching Fed. Road Funds 2.5% $ 3.5 million
+ The state transportation fund, law enforcement retirement fund, county governments and the wildlife conservation fund receive the remaining 2.33 percent of vehicle revenues.
* Because education receives approximately 55% of general revenue funds, a $64.9 million reduction of general revenue dollars would cost education $35.5 million. When combined with the direct cut of $48.7 million under the GOP tag bill, the total loss to public education would be approximately $84 million annually.
"The Republican program chips away at an education budget that is already stretched to the limit. With one hand, we were able to give teachers a $3,000 pay raise this year, but with the other hand, the Republicans are trying to take back a good chunk of school funding that's needed for
classroom expenses. That's no way to run our education system," said Senator Hobson.
Responding to criticism from schools that are worried about losing their share of vehicle funds, Governor Keating and Republican legislators have talked about "protecting" the current recipients of vehicle funding by taking the entire $139 million out of the general revenue fund.
That, however, will also impact education because it receives the largest share of general revenue fund dollars.General Fund Recipients % Share Funds Lost to GOP Tag Bill Education 54.8% $76.1 million Transportation & Gen. Gov't 10.1% $14.0 million Health & Social Services 9.0% $12.5 million Human Services 12.1% $16.8 million Natural Resources 2.5% $ 3.5 million Public Safety 10.8% $15.0 million REAP, Capital, Deferred Savings 0.7% $ 1.1 million
"No matter how you look at the Republican tag bill, it still adds up to a huge hit on public schools. They may try to juggle the numbers, but the $139 million still has to come from somewhere and unfortunately, the major share always comes out of education. I know our schools can't afford that," said Senator Hobson.
Because of the impact on education and other services, legislative leaders have advocated a more responsible tag bill that reduces license fees without significantly reducing state resources.
HB 2663 would cut tag fees to $85, $45 and $15, but would lessen the impact on education and other services by increasing the excise tax slightly. The end result would still be $11 million in savings for Oklahoma motorists.
"This legislation reduces tag fees without killing our public schools. If you're truly interested in protecting education, you have to be thinking in those terms," said Hobson.
Governor Keating and Republican legislators have insisted that the state has enough "surplus" revenue to approve a $139 million tax cut, but the budget numbers tell a different story. Existing obligations on road construction, prison expansion and other issues will consume all growth
revenue and more, according to the Senate budget leader.
"There's no secret pot of money out there. It's all been spoken for. Unless Governor Keating and his supporters are interested in defaulting on our road construction bonds or ignoring other obligations, the numbers on their tag bill won't add up. No matter how tempting it might be to them, we can't deficit spend in Oklahoma," said Senator Hobson.