OKLAHOMA CITY (KFOR) – As non-essential businesses stay closed in towns and cities to fight the spread of COVID-19, it is having a major impact on sales tax dollars.
In fact, some experts believe the impact might be felt by Oklahoma towns more than any other state in the country.
To be clear, everyone KFOR talked to on Wednesday says public health comes first. However, governments at all levels across the state are not just fighting the coronavirus, but they are fighting to stay afloat financially.
“You have the COVID-19 pandemic and Saudi-Russian battle flooding our world with cheap oil, so Oklahoma has really gotten in a deep hole,” said Rep. Terry O’Donnell, House Majority Whip.
As state lawmakers work this week to plug a $450 million budget deficit, Oklahoma cities and towns are dealing with their own issues
“As a city in Oklahoma, we are 100% reliant on sales tax. We don’t get any property tax so we know we are going to see a pretty big hit,” said Casey Moore, with the City of Edmond.
Other states don’t rely 100% on business transactions to fund their city governments.
“Oklahoma is going to get hit the hardest,” said Mike Fina, Executive Director of the Oklahoma Municipal League.
Federal dollars have been promised but state lawmakers say most of that money will go to bigger cities.
“It is our smaller municipalities that don’t have the additional revenue streams that cities like Tulsa and OKC have that are very reliant on their sales tax and it is going to impact them very hard,” said Fina
“Sales tax is 100% what we rely on. We totally, 100 percent, anticipate a decline in sales tax,” said Dave Richards, with the Midwest City Fire Department.
The Midwest City Fire Department is like a lot of other public safety entities that are anticipating budget cuts.
Richards says it’s not likely to lead to massive layoffs but if the shutdowns continue, cuts will be made to things like trainings and uniforms.
“We’re going to have to look at line by line all the different budget expenditures we have,” said Richards.
“A lot of the hoarding stuff that went on early on helped the sales initially and now we starting to see it decline.”
Rob Wasoski is a Norman police office and is also the president of his fraternal order of police. He says the decline could affect the paychecks of his fellow police officers.
“Salaries are directly tied, as far as raises, to the amount of sales tax that we get. If it went on for an extended period of time, you could see some reduction but I’ve been told that the public safety would be the last cuts that would be made,” said Wasoski.
Officials say it’s now more important than ever to support local businesses because you are not only helping the business, you are putting sales tax dollars into that local government.