Bison sculpture at Tallgrass Prairie Preserve, Osage County, ID’d by Peg Gotthold.
(Note: Have had correspondence with Mr. Griffith and likely I will be following up with a significant correction; appears he did NOT include federal funds. So now I need to find another $8 billion our state expends according to NASBO, and will comment on other aspects. Enjoy.)
The Latin phrase Labor Omnia Vincit is Oklahoma’s state motto—“Work conquers all”. TABOR is an acronym for Taxpayer Bill of Rights, a legislative proposal pushed by Stink Tanks that would limit increases in state and local government spending to no more than the rate of inflation plus the rate of population growth. Colorado enacted this as an amendment to its state constitution in 1992. So when I read “Spending restraint would save Oklahoma taxpayers billions” now posted on the website of the Oklahoma Council of Public Affairs I had to learn more, very little more, about Colorado’s TABOR to check this claim by author Joel Griffith, supposedly a TABOR expert for the American Legislative Exchange Council, a national stink tank, and a lawyer. I also exhausted my Latin vocabulary from two years’ high school study so had to finish the title by exhausting my French vocabulary (sadly had to use Google).
Mr. Griffith leads off with this claim about Oklahoma:
According to the National Association of State Budget Officers (NASBO), total state funds expenditures are expected to smash records in fiscal year (FY) 2018 for the seventh consecutive year, after rising from $11.5 billion in FY 2011 to $16.1 billion in FY 2017.
Right off the bat I knew this would be an easy one. I lived through FY 2011 to FY 2017 budget preparations with an Oklahoma school district and immediately suspected two problems with his numbers. First, to get to $16.1 billion that would include federal funds flowing through the state and I doubted that TABOR would restrict federal spending since it is a state measure. Also I was pretty sure that Colorado, unlike Oklahoma, had accepted Medicaid expansion under Obamacare demonstrating their common sense that you don’t deny your citizens a federal benefit they are paying for. And second, the increase from $11.5 to $16.1 billion simply didn’t jive with the state aid cutbacks school districts had experienced during that time.
I easily confirmed my suspicions by viewing the Comprehensive Annual Financial Report issued by the State of Oklahoma for both FY 2011 and FY 2017. This is from page 54 from CAFR FY 2017:
I’ve been around our state numbers and other financial reports enough to know that, with some effort, we could probably tie into his $16.1 billion with the numbers on this page. Regardless of how close we could get I’m very confident that his $16.1 billion must include federal funds passing through the state because that $6.7 billion in federal grants is over 40% of the total—the very thing that had an OCPA fellow in a tizzy about which I commented in my last post.
Now that I have a credible source for FY 2017 let’s look at the same report from page 52 of CAFR FY 2011:
These numbers don’t even begin to support his assertion that Oklahoma’s state expenditures were $11.5 billion in FY 2011. He is simply wrong, wrong, wrong—and shame on the fellows at the OCPA for publishing this slop. Later I will reveal what I think this new Limited Thinker has done, though I’m not going to prove it in this post.
For FY 2011 you see that federal grants made up an even larger share of the state’s revenues, probably the result of the ARRA stimulus that helped move our economy out of the Great Recession of 2008 and set us on the path to a steady expansion that continues today. This brings us to the second reason Mr. Griffith is a Limited Thinker—he’s including federal funds in his calculations. Here’s his “billions” conclusion:
What would TABOR have meant for Oklahoma? Since 2000, total state funds spending would have increased just 56 percent rather than 108 percent if limited to just the combined growth in inflation (42 percent) and population growth (14 percent.) Failure to adhere to such basic constraints created a budget blowout of $16.1 billion in FY 2017, a whopping $3.6 billion higher than the $12.7 billion in spending the state would have had with TABOR-constrained growth.
Even though Mr. Griffith purports to being an attorney, apparently he has not read TABOR in the Colorado Constitution. If he had he would find this language at Article X, Section 20, subsection (2):
(e) “Fiscal year spending” means all district expenditures and reserve increases except, as to both, those for refunds made in the current or next fiscal year or those from gifts, federal funds, collections for another government, pension contributions by employees and pension fund earnings, reserve transfers or expenditures, damage awards, or property sales.
This language defines the spending limitations imposed at subsection (7) of Colorado’s TABOR. It clearly does not limit Colorado in any way from expending whatever amount of federal grants or funds come its way. A proper analysis, performed by a true researcher who is able to think clearly and has the necessary reading, writing and arithmetic skills, of TABOR’s impact on Oklahoma state expenditures would begin by subtracting from its total spending all “gifts, federal funds, etc.” as defined above. No way would the resulting numbers for FY 2011 or FY 2017 be the silliness used by Mr. Griffith. Based on the numbers above FY 2011 will be less than $9 billion and FY 2017 less than $10 billion. So between the two he is only off a whopping $8.5 billion or so.
I won’t take up my space with his silly chart that displays his foolishness, except to quote the legend:
Source: Author’s calculations based on data from NASBO, Federal Reserve, Census Bureau.
To apply TABOR you need to make calculations using three data sets: population growth for which the Census Bureau is the best source; the Consumer Price Index for the state for which the Commerce Department is the source, but possibly the Federal Reserve republishes the numbers; and accurate amounts, as defined in TABOR, for expenditures and revenues in actual dollars, i.e. no adjustment for inflation, for which I would go to that state’s official records for the data. But note that he uses NASBO, a source I’ve not explored, but my hunch is that the data he pulled for Oklahoma, in addition to making no effort to adjust for federal funding, probably is adjusted for inflation, which would explain some of the huge difference for FY 2011. Just a hunch, but I have already demonstrated that my hunches are better informed than his “research.”
Finally, what about his calculations. Maybe he knows how to, maybe he doesn’t. I can’t tell because “garbage in, garbage out” defines his work. Until Mr. Griffith takes the time to understand what TABOR provides and to understand a state’s financial reporting he has no business alleging “billions” would have been saved. Again shame on the fellows at the OCPA for publishing such rank garbage.
As always lunch is on me for the first to ID the photo location.