A penny sales tax explained


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    State Question 779 could be the biggest Oklahoma issue that brings out voters in November, but what would an extra penny-per-dollar you spend mean for Oklahoma?

    “We should not be ok with being dead last in what we spend to educate our children,” said Amber England of Stand for Children, one of the leading voices in support of 779.

    Even critics of the proposal say the issue of teacher pay and education funding is of foremost concern to Oklahomans.

    “Teachers have needed a pay raise for quite some time, it is well past time to do a teacher pay raise,” said Dave Bond with OCPA Impact. Bond has helped lead the charge against the state question. OCPA Impact has filed two constitutional challenges to keep 779 off the ballot. The second challenge resulted in minor changes to the wording you will see on the ballot.

    “The issue is whether we should increase the sales tax burden on working families, regardless of income, to literally the highest of any state in the country,” Bond said.

    The tax issue is one of the key criticisms of 779. It is true that when you combine state taxes with local sales taxes and add one penny, or one percent, some Oklahoma communities would have the highest sales tax in the country.

    However, that is not the case for all of Oklahoma.

    According to the Tax Foundation, the state's current sales tax is 4.5 percent. Add one percent and we're at 5.5 percent, which would put Oklahoma about middle of the road in terms of straight state sales tax rates.

    England believes that families in Oklahoma are willing to make the investment in order to make sure the best teachers stay in Oklahoma.

    Teacher pay raises are nearly universally supported by both supporters and critics of 779, however that is not the only thing the money raised will go towards.

    “When you look at the fine print of the ballot question a minimum of 40 percent of the money will not go to teacher salaries period,” Bond said.

    This statement is true. The money raised goes into a special Education Improvement Fund. However, public schools will get nearly 70-percent of new money and a large portion of the public school share is required to go towards providing teachers at least a $5,000 pay raise.

    The rest of the public education portion of 779 goes to other programs aimed at helping improve reading programs, increase graduation rates and better prepare students for college.

    The public education portion of the money will have to be audited every year.

    The rest of the funds raised through 779 will be split between early childhood education, career tech and higher education.

    “There is nothing in the fine print that tells them to spend the money on college affordability, or anything specific,” Bond argues.

    The fact is, there is nothing in the ballot measure specifically directing how higher education on its portion of the funds. The measure says it can be used to improve college affordability but could also be used to improve higher education.

    What does “college affordability” mean?

    “There is enough funding in 779 that colleges and universities should be able to freeze tuition for a couple of years and that is if the legislature stops these horrible cuts to higher education,” England said.

    The Board of Regents for Higher Education said colleges and universities are committed to making sure they remain affordable.

    However, critics say the oversight that is written into 779 for the public education funds is lacking for the money that will go to higher education. Supporters say colleges and universities already have that oversight to prevent wasteful spending.

    “Colleges and universities are incentivized through a performance based funding formula to make sure they spend State Question 779 dollars on addressing college affordability.”

    OCPA Impact's own teacher pay raise proposal, which failed to get support from politicians, pointed out millions in potential waste including in higher education’s current budgets.

    “Everyone knows that without strong schools we can't have strong communities and we can't have a strong state,” England said. She said the people of Oklahoma have waited long enough for politicians to provide a solution and now have the opportunity to fix the problems in education.

    According to both sides, polling for State Question 779 shows it is enjoying wide support, in no small part due to the issue of teacher raises. However, OCPA Impact’s polling shows that a majority of Oklahomans would prefer to fund teacher raises by cutting wasteful spending.

    However, the legislature didn't do that and instead voted to give their own budgets an increase.

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