Monday, February 24, 2014

Oklahoma Lawmakers Find Money for Capitol Renovation but Not for Programs for Poor

by Nomad

When it comes to social programs for the needy, the Oklahoma lawmakers are all about cutting programs for the poor and lowering taxes. However, strangely, they have still managed to find enough money to refurbish and repair the ostentatious Capitol building. 

Journalist Dylan Goforth, writing for TulsaWorld, reports how lawmakers in Oklahoma are faced with a delicate situation: how to justify the renovation of the Capitol building while making deep cuts to programs for the poor. 
Already renovations to three floors on the Senate side totaled $3.3 million. That's just the beginning.
The entire project has drawn some criticism. The two sides received a total of $7 million at a time when numerous state agencies were requesting money.
Seven of two-story drapes, each costing over $2500, and shutters, costing $2000 each, totaled to more than $30,000. That's just the window treatments, mind you. Add to this two large screen television, two credenzas from which the televisions rise, a projector and a video screen. The article lists other expenses such as a full kitchen, complete with dishwasher, ice machine, refrigerator and new cabinets, cost $14,542. 
It all adds up quickly and that just the beginning. 

Lawmakers complain about the sewage that's seeping and mold that's stenching and the toilets that (someday soon) will not flush. While they all might agree that the Capitol building  is in a dreadful state, it looks pretty snazzy from the "before" photos. Not true, say staffers.
Electrical wiring in the building is so bad that there are sections where plainly visible cables are knotted together in a jumble. Some of the wiring remains from the building's early-20th-century days, staffers said.
It might lead you to think that nothing has been done since the ornate building of the pink and gray granite and white limestone was completed in 1917. 
That's not the case. 
In fact, work was done in 1998. But not renovation. In that year, the legislature funded the construction of a grandiose dome crowned with a 22-foot-tall bronze sculpture called The Guardian. The cost? $20.8 million. That dome was completed on November 16, 2002. Instead of a swanky dome, the $20 million could have easily paid for all of the cost for today's work.

Oklahomans have every right to be proud of their seat of government. Located on more than 100 acres in NE Oklahoma City,  the Capitol building is by any measure a beaut. Modeled in an Greco-Roman style, the structure comprises 650 rooms and 11 acres of floor space with murals, restored stained glass, tribal flag plaza and changing art exhibits. All very impressive to the gaping tourist but up-keep is a massive headache.
The people in charge of the renovation project say that over the years, poor decisions, short-term thinking and piecemeal solutions have made the problem worse than it should have been. (From the photos on the right, it doesn't look like anybody cut any corners.) The staffers say, even though austerity is the subject on everybody's lips, this is a problem that can no longer be ignored.
Apparently the renovations were not a high priority during Oklahoma's boom times when oil prices were at their peak. Before the economic downturn, the income tax in that state brought in more than $2.5 billion a year. Now, this project is, according to the governor,  a matter of state pride.

Last week the Senate approved of a $160 million bond issue, as the article points out, but it has an uncertain future in the House. Governor Fallin had proposed a bond for repairs to the state Capitol in her 2014 executive budget and her State of the State Address that she submitted earlier this month to lawmakers.
Upon hearing the news of the vote, Governor Fallin congratulated the state senators for voting to pay for the repairs.

“It’s our responsibility to maintain and preserve our seat of government. A bond issue is the best, most realistic option for restoring the People’s House.”
Even though the state has money set aside for such expenses, the legislators have instead decided to use the taxpayers to foot the bill for the renovations. 
Rep. Marty Quinn, R-Claremore, asked why the renovation project was viewed as a necessity when funded by taxpayer dollars from the state's general fund but wouldn't have been deemed a necessity if it had to be paid out of the state's "rainy-day" fund or other accounts.
Further work seems inevitable, the article notes. As Oklahoma lawmakers continue to debate how will those costs be paid for which is delaying the project, the cost estimates of the repair  have continued to grow. 
*    *    *
The most logical solution is the one that conservative lawmakers are loathe to do. Raise taxes. That is something Oklahoma governor Mary has vowed not to do. She instead favors a reducing taxes. Fallin says she believes that reducing the state income tax will - magically- generate more more revenue for the state because residents will spend the amount they are allowed to save from the reduction.

This magical thinking dates back from the Reagan days and has long since been discounted by economist after economist. Economist Greg Mankiw, who also served as chair of the Bush Council of Economic Advisers (CEA) wrote:
I used the phrase "charlatans and cranks" in the first edition of my principles textbook to describe some of the economic advisers to Ronald Reagan, who told him that broad-based income tax cuts would have such large supply-side effects that the tax cuts would raise tax revenue. I did not find such a claim credible, based on the available evidence. I never have, and I still don't.
Nevertheless, without much supporting evidence, Fallin will continue to spread the anti-tax gospel. Even while the Capitol building collapses around her ears and the state treasury drains away. 

While Oklahoma lawmakers are moaning about the decorations, they have approved of the governor's 2014 budget which calls for cuts to numerous programs for Oklahoma's poor.
Some of the biggest cuts to social programs in Oklahoma have been:

  • Title 1 grants (services for disadvantaged students, identified as eligible for free and reduced lunch) – A loss of $13.9 million and 220 jobs;
  • Special Education grants (preK-12th grade students) – A loss of $12.8 million and 205 jobs;
  • Vocational Rehabilitation grants – A loss of $3.6 million and 30 jobs;
  • Career Technology grants – A loss of $1.4 million and 22 jobs; and
  • Head Start grants – $8.2 million and 540 jobs.
That's just the beginning of the slashing. According to another article, the governor  has proposed a 5 percent reduction in state appropriations to the Oklahoma Health Care Authority, the agency that oversees the Medicaid program.
That amounts to a $47 million cut to the agency’s budget at a time when the federal health care law is driving tens of thousands of low-income Oklahomans into the program.
Admittedly the money for the renovations is quite small by comparison. The problem is a that, in the end, it is a matter of priorities.
On one hand, the legislature can vote to maintain adequate education for students, to support job retraining for the out of work, to offer pre-school to poor children and to ensure adequate health care for the most needy of the state. 
And on the other hand, the lawmakers can vote to make refurbish the already ostentatious Capitol building to the benefit of a small number of politicians, their staff and their guests.