Good Government

Stitt touts education, tax cuts, savings

February 7, 2022

Ray Carter

Gov. Kevin Stitt called for major education reform, tax cuts, and increased state savings in his latest State of the State address.

While enactment of conservative policies during his tenure has generated positive momentum, Stitt said that doesn’t mean Oklahoma has achieved its full potential.

“Just because your life is great, or your business is thriving, or your school is fine, doesn’t mean we don’t have an obligation to make sure everyone has that same chance,” Stitt said. “We’re all here because we have a higher calling to do what’s right, not what’s easy.”

Stitt endorsed significant expansion of school-choice, saying parents should have the greatest input into how their children are educated and that state policy should support them by maximizing educational opportunity.

“We can drive hope for all Oklahomans through education,” Stitt said. “Throughout my time as governor, I’ve committed to putting our students first.”

He also called for eliminating the state sales tax on groceries and for gradually cutting the income tax based on revenue growth.

The governor noted only 13 states tax groceries and that Oklahoma’s overall sales tax rate on those purchases is among the highest imposed.

“Many Oklahomans are already struggling under the weight of record inflation,” Stitt said. “Let’s give them more help this year.”

Senate President Pro Tempore Greg Treat, R-Oklahoma City, has filed Senate Bill 1495, which would eliminate the state sales tax on groceries.

“Inflation is near a 40-year high and is draining the budgets of all Oklahoma families,” Treat said in a statement issued following Stitt’s speech. “The state sales tax on groceries is a regressive tax that harms working families the most. I look forward to partnering with the governor to pursue the elimination of the state's grocery sales tax so that we can give Oklahoma families meaningful tax relief.”

Stitt also called for further reducing Oklahoma’s income tax. Last year, lawmakers voted to cut the top rate from 5 percent to 4.75 percent. Stitt said additional reductions are needed to compete economically with other states and that officials can achieve that goal by using growth revenues to offset any rate reduction.

“Nine states don’t charge a personal income tax. Many others are racing to join them. We can’t be left behind,” Stitt said. “My vision is to create a taxpayer protection plan that responsibly lowers income taxes according to our state revenue. Cutting taxes based on how our economy grows ensures we’ll always have money to pay for core services like education and roads and bridges. And as our economy grows, Oklahomans share in our success by keeping more of their hard-earned money.”

He also called for exempting military retirement benefits from the state income tax.

Stitt also praised members of the Legislature for working with him on “prioritizing saving over spending,” noting state government now has over $2 billion in savings, which is the “largest savings account in our state’s history.”

He urged lawmakers to raise the existing cap on state savings to further protect taxpayers during future downturns.

The two years prior to Stitt’s first year in office were marked by revenue failures, he noted.

“We had almost no money in savings, which meant budget cuts were an annual challenge,” Stitt said.

Today, the situation is very different.

“Because of our great work together, Oklahoma’s turnaround is well underway,” Stitt said. “Our fiscal house is in order. We’re coming off a year where we made record investments in education while still cutting taxes. We’re fourth in the nation in budget reserves. Our state’s credit rating has gone up.”

The governor noted there are 40,000 more Oklahomans with jobs today than there were when he took office and the state unemployment rate is down to 2.3 percent, the “lowest in state history.”

He indicated that progress is due in part to the state’s response to COVID-19. Whereas other states imposed significant extended shutdowns and mandates, Stitt has stressed granting citizens maximum flexibility and trusting personal responsibility. He said that has made Oklahoma a place that appeals to citizens in other states.

“Across the country, huge numbers of Americans are moving to states that value freedom and trust their citizens to make choices for themselves,” Stitt said. “There has never been a bigger difference between a red state and a blue state. Freedom-loving Americans cannot escape liberal lockdown states fast enough. Since April of 2020, more than 27,000 of them have moved to Oklahoma.”

The governor also addressed other issues in his speech.

Stitt called for creating an Oklahoma First Responders Wellness Division to help address mental-health challenges associated with working in law enforcement, creating a joint statewide training facility for law enforcement, and creating a “consolidated, unified command structure within a single department,” which would duplicate the structure used in 43 other states.

Stitt also endorsed investing $13 billion in transportation over the next 10 years to improve Oklahoma roads.

“This is our moment to make Oklahoma’s transportation system the best in the nation,” Stitt said.

House Speaker Charles McCall, R-Atoka, issued a brief response after Stitt’s speech.

“House Republicans found plenty to like in the governor’s speech as we begin another strong year to close out what is already the most comprehensive policy session in recent history, thanks to last year’s extensive accomplishments,” McCall said. “We were glad to hear shared priorities like protecting Oklahomans’ individual liberties, growing the economy, and stopping black market marijuana, plus solid fiscal policy to keep cutting taxes and saving money amid record revenues while still paying troopers more, rewarding high-performing teachers, and investing in infrastructure, especially broadband. As always, the House will work in good faith on these and other issues as we continue strengthening Oklahoma together.”

House Minority Leader Emily Virgin, D-Norman, took a different tack, calling Stitt’s speech “the most divisive State of the State that I have heard in 12 years.”