Guest column: Sen. Frank Simpson’s Session Review
Oklahoma’s recovery has exceeded our expectations despite the ongoing pandemic. Our economy is strengthening. May’s gross receipts increased by more than 34% compared to last May with every major revenue stream showing strong growth. Our state economy is strengthening. This is mostly due to our immense oil and gas production tax collections, which have increased by more than 128% compared to last May. People are also shopping and spending money in our local communities as we also saw an increase in sales and use tax collections of 26%. Oklahomans can also be proud that our unemployment rate is one of the lowest in the nation, which tells us businesses are hiring and expanding. The State of Emergency has been dropped as we continue to see a decrease in COVID-19 cases and deaths. It’s wonderful to see Oklahoma thriving after a year of such incredible uncertainty and difficulty. We’re welcoming new industries and companies, and Oklahoma should continue to see statewide economic improvements in the coming months.
Our strengthening economy, along with the decision not to spend all the revenue we had available last session, allowed us to pass the largest budget in state history at $8.8 billion. This budget not only restored cuts made to agencies last year during the economic downturn but increased most agency budgets. We also put $800 million back into savings, bringing us back over $1 billion once again for future emergencies. This is an incredible achievement given that last session we were facing a $1.3 billion shortfall.
The historic FY’22 budget will also provide Oklahomans and businesses much-needed tax relief following such a difficult year. Lowering the personal income tax to 4.75% puts Oklahoma among the ten lowest rates in the country. Then among states that have a corporate income tax, we’ll have the third lowest rate nationwide at 4%. The earned income tax credit refundability is also being restored to further help low income working families. These changes are not only important to support Oklahoma families and businesses but are also important economically as they’ll help attract more people, companies, and industries to our great state.
We’re further helping grow the state’s economy and improve the lives of Oklahomans by providing $42 million in tax rebates to providers who expand broadband service to underserved and unserved areas. Unfortunately, Oklahoma ranks 47th in broadband connectivity. Having internet access is critical for those studying, teleworking, needing telehealth services, searching for a job, applying for unemployment, or simply trying to stay in touch with loved ones. However, for many in our state this has been impossible, or nearly so, especially in rural areas where there isn’t any access or limited access to broadband services. We’re living in a digital age where we depend heavily on the internet, and Oklahomans deserve better services.
This will not only help individuals and businesses in our state but addresses one of the main concerns of corporations looking to relocate here.
Our economy will be grown further through $35 million in new economic development funding focused on increased job and business recruitment efforts. Another $15 million will be infused into the Rural Economic Action Plan (REAP) to help with important infrastructure project grants in small towns of less than 7,000.
One last area of investment that is crucial to our state is healthcare. Besides funding the first year of the voter-approved Medicaid expansion at $164 million, we also reestablished a historic sales tax credit for OU Health that will ensure many more doctors and nurses are able to be trained in state.
There is much more to this record budget, but these are just some of the high points. I’ll discuss more in the coming weeks, along with some of the major policies that were signed into law. After overcoming the worst pandemic in modern history, Oklahomans should be so proud of what we have accomplished together. While other states are still reeling from the fiscal impacts of the pandemic, Oklahoma is showing the world what can be achieved through hard work and determination.
If you have any questions, please don’t hesitate to call, or email me at (405) 521-5607 or Frank.Simpson@oksenate.gov.