Eliminating Intangible Property Tax Means Deep Cuts For OK Schools

Oklahoma public schools are bracing for a tax cut that it seems no one can predict with much certainty.

Schools are always waiting this time of year to see what happens with the state budget, but one part of the equation is certain: there's going to be a loss of funding because of a tax cut voters approved last fall.

Debra Jacoby is Chief Financial Officer for Union Public Schools. She said she's worried the tax cuts of State Question 766 will mean big cuts in her district.

"And now they're estimating we could lose up to $120 per student," Jacoby said.

SQ 766 eliminated intangible property taxes. The main benefit is expected to go to large corporations, like Cox Communications, and AT&T, with interstate operations and big brand names.

10/17/2012 Related Story: Supporters Say State Question 766 Could Impact State Job Growth

While the railroads might benefit from cutting their property tax payments, public schools will take the biggest portion of the loss. They depend on property taxes for the bulk of their funding.

The Oklahoma Policy Institute has been studying the possible impact, but says a solid number is hard to come by, in part because intangible property has never before been separated on tax returns.

"The indications are that companies are going to take a broad view of what it considered intangible property, and it could be a pretty significant hit," said David Blatt.

Blatt said it's possible the tax cuts could eliminate as much as $120 million in taxes statewide. He said the schools are not overstating the potential impact.

Jacoby says, at Union, the predicted shortage of tax money would force noticeable cutbacks, on top of the cutbacks of the last five years.

"We will not take one cut in one place, we will take a lot of cuts throughout our district, in all areas and in all buildings," Jacoby said.

The expected cuts and their impact at Union will be hashed out Tuesday night in a meeting of a parents' legislative lobbying group.

They're meeting at 6 p.m. at the Union Collegiate Academy at 66th and Mingo.