REPORT TO

OKLAHOMA CONSUMER DEFENSE FUND

« JA N UA RY 2010 F O C U S G R O U P R ES EAR CH »

Pete Brodnitz
Benenson Strategy Group
February 9, 2010
1000 Potomac Street N.W. Suite 420
Washington D.C. 20007
(2 0 2) 3 3 9 6 0 6 0
 TABLE OF CONTENTS

KEY FINDINGS AND CONCLUSIONS.......................................................................... 2

OKLAHOMA ECONOMY ............................................................................................ 6

OKLAHOMA BUDGET: AWARENESS AND CONCERN ................................................... 7

OKLAHOMA BUDGET SHORTFALL: CAUSE AND BLAME .............................................. 9

OKLAHOMA STATE SERVICES ................................................................................ 11

SPENDING CUTS VS. RAISE REVENUE .................................................................... 13

OKLAHOMA BUDGET SHORTFALL PROPOSALS ........................................................ 15

APPENDIX – TEXT OF PROPOSALS ......................................................................... 17

METHODOLOGY

Two focus groups were conducted in Tulsa, Oklahoma on January 27, 2010. A total of
16 respondents participated in two groups separated by gender: one group of eight
women and one group of eight men.

The two groups were comprised of likely 2010 general election voters, and each
participant:

• Self-identified as either a resident of an urban, suburban, or rural area.

o Was a resident from Creek, Muskogee, Okmulgee, Osage, Rogers, Tulsa,

Wagoner, and Washington counties.

• Self-identified as a moderate or conservative.

• Indicated an active interest in and awareness of current events.

• In addition, some participants were self-identified business owners (3 women, 5

men).

Report to Oklahoma Consumer Defense Fund

January 2010 Tulsa, OK Focus Groups

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 KEY FINDINGS AND CONCLUSIONS
Overview

• There is widespread belief among participants that the poor national economy has impacted the
Oklahoma economy and subsequently the budget: “We’ve just gotten the tail end of it…it’s going
to get worse before it gets better,” said one participant.

• Participants tended to say Oklahoma’s economic problems are generally less severe than those in
other states in the region for three reasons:

o A belief that Oklahoma did not see the boom and bust of the real estate market;

o A belief that the state’s perceived undiversified economy and heavy dependence on the
oil industry somewhat insulates them from shifts in other parts of the economy; and

o A belief that Oklahoma has a lower cost of living that protects the state during a national
economic downturn.

• When given a full picture of the budget shortfall, many participants saw a potential long-term
crisis for Oklahoma because of the risk of continuing budget shortfalls of increasing severity.
Participants were generally unaware that Oklahoma’s budget needs to be balanced annually.
Most were unaware of the current budget shortfall and, once informed of the amount of the
shortfall, most participants underestimated the $730 million shortfall as about 13% of the total
budget (instead of the roughly 18% it represents). “That’s higher than I thought,” said one
participant about the shortfall.

• Most participants said the state budget shortfall was a result two things:

o A statewide revenue shortfall, which was seen as the major reason for the shortfall, with
high unemployment levels seen as a contributing factor to budget problems; and

o Inappropriate spending, including wasteful spending and money spent on non-taxpayers

who use taxpayer-funded services but don’t pay enough taxes to offset these perceived
expenditures on their behalf. In particular, there was a widespread sense that illegal
immigrants and people from out of the state are a big drain on the budget (the women’s
group specifically cited “illegal immigrants” as living in Oklahoma and using state services
but not paying taxes).

• Upon hearing that the budget shortfall could reach $1.5 billion next year, participants became
worried that the state would not plan for the future and instead make short-term budget fixes
that will hurt the state in the long-run like they have in the past. This suggests Democrats
should emphasize long-term job creation and educational goals in the budget process that will
benefit the state as well as generate immediate revenue to address the current shortfall.

• The women’s group supported the use of the state’s Rainy Day Fund to cover the shortfall.
“What is the rainy day fund for if not for these times and this crisis?” asked one woman.
However, concern for future problems arose as several participants questioned what would
happen once the fund was emptied and no longer an option. This means Democratic efforts to
use the Rainy Day Fund to cover the shortfall would be best received by voters if coupled with
proposals to fix budget problems long-term.

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January 2010 Tulsa, OK Focus Groups

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 • Participants largely blamed “leadership” in the state legislature for causing the budget shortfall
instead of Governor Henry. Participants tended to trust the GOP more on handling the budget
than Democrats. However, there was high anti-incumbent sentiment among them as well, which
means voters are moving in a favorable direction for Democrats by blaming the leadership. This
also means that Democrats can believably attack the Republican leadership for causing the
budget shortfall and therefore box them in as not being the solution to it (especially if the
Republicans push short-term fixes that will not result in long-term solutions).

• Participants’ perceptions of the state’s budget expenditures were fairly inaccurate. They had
widely varying perceptions of how much the state spends in different areas of the budget. For
example, participants estimated education spending makes up 25% of the state budget, roughly
half of its actual 50% share of the budget, and estimated transportation, health, and public
safety combined make up roughly 56% of the budget (greater than the roughly 40% these
actually account for in the budget).

• The fact that Oklahoma state expenditures rank 50th in the U.S. largely did not affect
participants’ views on the state budget. They tended to already believe that the state spends
less and taxes less than other states. Despite this, highlighting the low expenditure level will
help make the case that, while cuts must be made, it won’t take a lot to get the point where the
state is cutting into essential services such as education.

• Participants were generally opposed to most tax increases to raise revenue, including tax
increases on the wealthy and big business, and generally viewed it as a final option to fix the
budget shortfall. However, they were open to a few options if paired with other offsetting tax
cuts. For example, Democrats can support certain tax proposals like cutting the sales tax on
groceries in exchange for other revenue sources.

o To underscore the strength of the opposition to tax increases: most participants opposed
additional taxes on the wealthy, even if it meant their personal income taxes would be
lessened, and argued that higher taxes on certain industries or wealthy individuals would
result in a tax on themselves: “Can’t tax the top because they will turn around and tax
you back,” one observed.

• To raise revenue for the state, the proposals that had the strongest support among participants
were ones that diversified the state economy and moved it off its perceived dependence on the
oil industry (which means Oklahoma Democrats could benefit by underscoring how GOP
proposals will undercut efforts to diversify and improve Oklahoma’s economy, which is already
seen as small and lacking diversity), made it easier to conduct business by reducing costs for
types of insurance (health and workers’ compensation), and created jobs.

• There was also anger toward Indians for not contributing or paying taxes toward the budget.
Indian gaming, mainly casinos, was viewed as a problem because the gaming venues are
collecting revenue but not paying taxes. Participants saw this as a potential source of revenue to
fix the shortfall.

• Participants generally preferred budget cuts to fill the current budget shortfall. “They need to
cut…I’m sorry, but I’m not paying for services that probably need to be cut,” one participant said.
However, most were individually conflicted on what services to cut and in many cases said they
felt services were already lacking throughout the state.

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January 2010 Tulsa, OK Focus Groups

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 • Participants tended to view across-the-board cuts as only a temporary solution that would not
help future budgets, and as a result there was little support for increasing the across-the-board
cuts from 5% to 10%. In fact, many participants viewed this proposal to increase across-the-
board cuts as crossing the line between prudent cuts and severe cuts, and as cutting from an
already weakened budget.

• Instead, participants generally preferred targeted budget cuts. And, while unsure of what exactly
to cut first, most agreed that education cuts were by and large off the table, because they view
cuts to education as damaging to students and communities. This suggests an opportunity for
Oklahoma Democrats to fight back against GOP education cuts as short-sighted and detrimental
to children in schools that are already stretched thin.

• Participants generally had low awareness of the budget cuts that have already happened at the
state level. However, they were much more aware of the cuts that happened at the local level,
primarily in Tulsa. This suggests that Democrats should focus state discussions on local impacts
and how voters are directly impacted, including cuts directed toward teachers and police, rather
than discussing state-level cuts.

• We explored six potential proposals to help close the state budget deficit:

o Two in particular could be framed as helping to diversify the state’s economy: health
insurance reform (which was the most popular proposal with participants) and
restructuring workers’ compensation. Participants said that both of these proposals were
ways to eliminate bureaucratic red tape for businesses, which will encourage new
industry to establish itself in the state and create jobs for Oklahomans. This means
Democrats can support these popular job creating measures and contrast them with GOP
support for unpopular across-the-board budget cuts.

 Participants viewed reducing health insurance premiums for Oklahomans as

having the most potential to generate revenue for the state while controlling
costs for consumers and businesses. In addition, many saw it as an opportunity
to reign in insurance companies, which many participants believed have too
much authority. “It’s outrageous, insurance companies shouldn’t have that much
control,” noted one participant.

 Restructuring workers’ compensation within the state was also seen as a cost-
effective way to generate revenue. “If you can make the state look more
economically pleasing to companies, even if they are going to relocate from out
of state, they are going to be more prone to come here,” noted one participant.
Participants tended to see this proposal as beneficial to employees, local
businesses, and out-of-state businesses considering coming to Oklahoma.

o The school consolidation proposal received mixed support, but most participants were
against it as they are content with the current conditions. Rural participants generally
viewed school consolidation as closing their schools and severing community ties, while
participants from urban and suburban areas tended to view it more as a viable way to
reduce administrative costs by consolidating administration jobs instead of closing
schools.

o The creation of the Office of Accountability and Innovation was seen as additional
bureaucratic red tape and something that should already be done in Oklahoma. This
means Democrats can say the creation of this Office would be an additional expense on

Report to Oklahoma Consumer Defense Fund

January 2010 Tulsa, OK Focus Groups

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 the budget when the state already has an independent office (the State Auditor) to
handle these exact issues.

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January 2010 Tulsa, OK Focus Groups

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 OKLAHOMA ECONOMY
Participants reported that the Oklahoma economy is not doing well, but they also believed that Oklahoma
is affected by the national economic crisis less severely and more slowly than other states. One man
summarized this sentiment, “we’re always behind…we tend to go into recession slower…we don’t see
extreme up and extreme down.” This sentiment has allowed Oklahomans to feel the budget crunch at
the national level but not necessarily believe the Oklahoma budget is in severe trouble.

Most participants saw Oklahoma’s economy as small, weak, and not diversified. One woman stated, “It’s
gradually gotten worse over the years.” While participants tended to believe that the Oklahoma economy
is feeling a crunch, they also contended that it is still in better shape than other states in the area.
Several participants cited the housing market bubble that burst in other states as a cause for their
economic troubles but saw Oklahoma as not having the same severity within the state. However, one
woman said, “It’s not to say we’re not affected here.”

They maintained that the cost of living is lower in Oklahoma which allows most Oklahomans to not feel
economic problems as severely as other states (like New York or California as several participants noted)
since the economy does not revolve around boom and bust cycles. However, participants felt the effects
of the weakened economy and noticed cost levels rising.

Oklahoma Economy
“We’re right in a little bubble” - woman
“Any state that doesn’t have inflated real estate is ok” - woman
“It’s gradually gotten worse over the years” - woman
“It’s not to say we’re not affected here” - woman
“We’ve just gotten the tail end of it…it’s going to get worse before it gets better” – woman
“Banks raising interests rates, that’s trickle down, a national problem” - woman
“We’ve had the same amount of income for 6 years and they raised our rates out of nowhere” – woman
“Better than most of the country” - man
“It’s never been peachy around here” - man
“Cost of living is a lot lower here than other places” - man
“We’re always behind…we tend to go into recession slower…we don’t see extreme up and extreme down”
- man

Report to Oklahoma Consumer Defense Fund

January 2010 Tulsa, OK Focus Groups

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 OKLAHOMA BUDGET: AWARENESS AND CONCERN
The shortfall of the Oklahoma state budget was unknown to most participants. More participants were
aware of the budget problems in the city of Tulsa than statewide. As one woman asked her fellow group
members, “don’t you think we hear more about the Tulsa budget than the state budget?” Since Tulsa
was seen as having budget problems, many participants assumed the state was having “problems” as
well, but they were not generally aware of an actual budget shortfall. Participants also tended to be
unaware that the state budget needs to be balanced every year.

Once informed of the current $730 million shortfall, participants estimated the shortfall represents
roughly 13% (average score) of the overall budget and were surprised that it represents almost a fifth of
the budget. “That’s substantial” said one man while another said “that’s awful close to a billion.” While
participants did not initially think the budget was in a crisis when beginning the group, after being
informed of the shortfall (and the potential $1.5 billion shortfall next year), a majority of participants
believed that the budget is in a crisis and tough decisions need to be made to solve the problem currently
as well as in the future. This indicates that it is important to reference the actual figures to inform voters
of the magnitude of the problem (which also helps position the GOP proposal of across-the-board cuts
and quick fixes as the wrong solution).

There was general fear among the participants that. if the economy continues to weaken, the budget
problems in Oklahoma will get worse. One man summarized participant feelings, “it’s the beginning of
worse.” There was also a sense that the leadership in Oklahoma failed to plan the budget adequately.
One woman mentioned, in regards to problems with the education budget; “other states were having this
problem years ago…why didn’t Oklahoma prepare for that?” This statement tended to resonate with the
participants, who feared that if Oklahoma does not fix the current crisis while planning for future
problems, the state would continue to suffer and their pocketbooks would be stretched further.
Democrats can use this by focusing on long-term goals that will also have short-term results to fill the
current shortfall, and accusing the GOP of pursuing rash quick fixes that will have a long term detriment
to Oklahoma.

Asked if they would like state government to be run like a business, most participants viewed this as a
positive change from government bureaucracy. They did not associate carrying a debt with running a
business, and after defining a business as an entity that can carry debt, participants were wary of the
change. While many did not know the state needs to balance the budget every year, participants
generally opposed allowing the state to carry debt or establish a system that relies on too many outside
sources for future funding.

Oklahoma Budget
“There’s not enough income coming in and the state is spending like it’s good times” - man
“There’s no revenue being created” - man
“My wife is in education and she lost her bonus due to the shortfall” - man
“I didn’t get my annual cost of living increase because it wasn’t in the budget but they gave raises to
board members and area superintendents but I didn’t get mine” - man
“It’s in a better shape that other states…the real estate market devastated border states” - man

Tulsa Budget
“Don’t you think we hear more about the Tulsa budget than the state budget” - woman
“I don’t know about the rest of the state…do you hear this about OKC…no, it’s just Tulsa” - woman
“Not as much as the Tulsa budget” – man

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January 2010 Tulsa, OK Focus Groups

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Concern for Shortfall
“I don’t think they will fill it…we will go more into the red” – woman
“That’s higher than I thought” - woman
“That’s a crisis” - woman
“Problem slowly crawling toward crisis” – man
“That’s substantial” - man
“That’s a bad problem” - man
“That’s getting awful close to a billion” - man
“It’s the beginning of worse” – man
“We don’t invest in the future” – man
“If you look at any household, any deficit is a crisis” – man

Specific Budget Problems - Education

“Other states were having this problem years ago…why didn’t Oklahoma prepare for that” - woman
“In Oklahoma education is something you run for office for…then when they get elected it’s like
something they’ve never heard of” - woman
“They need to re-appropriate” - woman
“Everybody is getting hit but I’m sure there’s enough there (to cover education)” – woman
“They are already talking about pay-cuts for next year” – woman

Report to Oklahoma Consumer Defense Fund

January 2010 Tulsa, OK Focus Groups

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 OKLAHOMA BUDGET SHORTFALL: CAUSE AND BLAME
Cause for the shortfall was mainly seen to be focused on the weak economy in Oklahoma and
nationwide, which resulted in lower revenue. Several participants cited higher unemployment levels as a
major reason that the state is collecting less revenue, with one woman stating “the more people become
unemployed, the less pay state income taxes…that would be a large chunk of revenue.”

Anti-incumbent sentiment seems to be growing around the country and this is echoed in Oklahoma.
Participants tended to blame everyone in power (except Governor Henry) for the budget shortfall.
Participants did not explain why they exempt Governor Henry of blame for the budget shortfall, so further
testing would be needed to see the extent of blame on the state legislature and Governor Henry. One
woman said, “Anyone who has their hands in it should take some blame,” while a man echoed
“leadership” as being at fault. Oklahoma is one state where anti-incumbent sentiment may help local
Democrats who are in favor of fixing budget problems by reigning in spending while protecting essential
services and promoting job growth.

With Governor Henry not being viewed as a cause agent for the budget problems, it is essentially leaving
open the ability to believably blame the shortfall on the GOP in the legislature since they are currently in
power. While participants leaned more toward supporting the GOP in the next election, voters’ potential
anger at the controlling leadership in the state legislature may allow a Democratic challenger to attack a
GOP candidate’s unwillingness to plan for the future and fix the budget crisis in Oklahoma for the long
haul. The GOP didn’t make the plans and investments needed, which contributed to the crisis, and now
they are not the solution to the problem because they are looking for quick fixes and not the overhaul
necessary to protect priorities like education, low taxes, and streamlined business costs and requirements
to create jobs.

Blame for the shortfall not only rests on the state legislature but on other entities such as mortgage
lenders, insurance companies, and big banks. These industries were seen as a national cause that
weakened the economy that has trickled down to Oklahoma. In-state Indian casinos were also seen as a
drain on the economy and state budget as they are exempt from paying taxes. Residents spend money
in the casinos instead of on industries that generate revenue for the state.

Also, blame tended to fall on non-taxpayers in Oklahoma. Individuals not paying taxes, such as illegal
immigrants, were viewed as major causes of a weaker budget. Illegal immigrants were seen as a drain
on state services which in turn makes the state increase the budget to provide for taxpaying citizens.
Participants were generally supportive of efforts to include these illegal immigrants into the system to
generate revenue for the state (such as making illegal immigrants pay back taxes in order to stay in the
state).

Blame for shortfall

“Anyone who has their hands in it should take some blame” – woman
“Leadership” - man
“We are not a fast economy…we don’t grow and die we move slow” - man
“Those that deal with spending and the overview of spending” – man
“All you kept hearing was cut taxes cut taxes…well who is going to pay the bills” – man

Causes of shortfall
“Because of the economy right now I would say it’s not enough revenue” - woman
“The more people become unemployed, the less pay state income taxes…that would be a large chunk of
the revenue” - woman

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January 2010 Tulsa, OK Focus Groups

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“The media has scared me to death…I don’t want to spend anything” – woman
“Giving money back to the auto industry” - man
“Banks were practically forced to give to people who couldn’t even buy a house” - man

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January 2010 Tulsa, OK Focus Groups

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 OKLAHOMA STATE SERVICES
Oklahoma’s rank as 50th in state expenditures did not impact participants views of the budget.
Participants were generally not concerned with Oklahoma’s rank, recognizing that lower expenses and
reduced state costs allow them to keep more money. “If you take other states in comparison…you can
get something here for a third of what you would pay in Ohio” said one woman, while another reported
“annually here is what I paid in a month when I lived in Oregon.” Another woman summarized the
opinions of many participants, “we’re getting in an equal return” [to what we pay].

Participants still believe that they receive more services from their government than other states. One
woman stated, “I think I get more out of my government than you would get in California.” On average,
the participants believed that education makes up 25% of the budget (half of its respective total) and
transportation, public safety, and health make up 56% of the budget (16% higher than its piece of the
budget) – see chart below for participant average:

Actual: Roughly 40%

While they did not immediately volunteer departments as the best options for cuts, when pushed, they
did have a few priorities. Since participants generally believed the budget devotes more for services like
transportation that lack in consumer satisfaction than it actually spends, support for cuts to these services
was higher than cuts to other areas. When asked what should be cut from the individual department
budgets, participants were generally unsure, claiming that they wanted more for what they were paying.

Participants tend to underestimate the percentage of the budget devoted to education, consider schools a
priority and cuts detrimental, so they argue education should be off limits to budget cutting. The
underestimation of the percentage of the budget that is spent on education likely influences their desire
to protect education from cuts because they think less money is being spent on schools so there is less
money to cut and any cuts would be more damaging than if they thought schools were getting lots of
money.

The perception that education makes up less of the budget than it does in reality may be attributable to
the view that school programs are having trouble in the state with teacher furloughs and pay cuts.
Several participants noted that Oklahoma scores lower than most states in the region for education,

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January 2010 Tulsa, OK Focus Groups

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which may also be a good argument for Democrats against cutting the education budget. Also, once
participants were informed of the actual percentages the services take from the budget, many were
surprised that education takes such a large percentage but most are not willing to cut anything from the
education budget for fear that it could cause problems for schools and students.

State Services
“We have the lowest cost of living…I think I get more out of my government than you would get in
California” – woman
“I’m not saying what we’re paying we’re getting an equal return…” - woman
“Every major road that comes and goes into this area is a toll road” - woman
“Annually here is what I paid in a month in Oregon” - woman
“Our average income here is a lot less than other states” - woman
“That’s why our cost of living is lower here too” – woman
“If you take other states in comparison…you can get something here for a 1/3 of what you would get in
Ohio” - woman
“I don’t think our salaries compare to other states” - woman
“I’m not satisfied with what I’m getting here…medical care, law enforcement” - man
“We score fairly low on education, rest areas” - man
“Infrastructure is real poor here” - man
“What do we do with all of the tolls here?” - man

Report to Oklahoma Consumer Defense Fund

January 2010 Tulsa, OK Focus Groups

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 SPENDING CUTS VS. RAISE REVENUE
Almost all of the participants were unaware that the budget needs to be balanced every year and the
state cannot hold debt. Democrats can use this to their advantage as a reason to propose policies that
will benefit the state in the long run (with a balanced budget in the years to come) as well as create
revenue for the state now.

While participants believe Oklahoma is facing budget problems, they were largely unaware that the state
actually faces a budget shortfall. Once informed of the shortfall, participants were concerned how the
state would balance the budget. Most of the participants tended to favor making cuts to services rather
than increasing taxes; however, a few were willing to accept higher taxes if all other options were
exhausted and explained to the public.

When asked what services to cut, participants saw education as off limits as mentioned above. Since
there was a perception among many that education in Oklahoma is weak, cutting from education was
seen as destructive to students and communities. Participants were generally more accepting of cutting
from the transportation budget over health and public safety budgets. However, participants saw
infrastructure as a weak service provided to Oklahomans and tolls are already a costly burden on them.
One man asked “what do we do with all of the tolls here?” citing that the state already collects additional
money from them for road construction and improvement.

Participants were very concerned that if taxes are raised on industries such as insurance or banks, the
additional costs will be passed onto them; essentially any fees or taxes waged on industry would be a tax
on citizens. One man summarized participants’ feelings, “can’t tax the top because they will turn around
and tax you back.” Most were initially supportive of taxing insurance companies because, as one woman
said, “insurance companies have way too much control.” Many participants were not worried that
additional taxes would drive insurance companies out of the state. The concern that costs will be passed
down is stronger than participants’ support for additional taxes on insurance companies.

Resistant to new taxes in any form, participants were even opposed to additional taxes on wealthy
individuals. When asked if they would support raising taxes on individuals with higher incomes while
lowering their own taxes, participants tended to oppose raising taxes on anyone even if that meant they
will continue to pay a higher rate. Most participants were comfortable with the 5.5% flat tax rate
throughout the state citing that it is fair for everyone to pay the same amount, no matter the individuals’
income. Further testing on tax issues will need to be conducted in a survey to see if these views are
consistent with those of the general voting population.

The women’s group was willing to empty the Rainy Day Fund as a way to cover the current shortfall (the
topic did not arise in the men’s group). One woman said, “What is the Rainy Day Fund for if not for
these times and this crisis?” However, a few participants were wary of where the money will go once
used and what would happen for future crises. They see using the Rainy Day Fund as a short-term fix on
a long-term problem that they want more solutions for. Further testing will need to be conducted to see
the overall support of using the Rainy Day Fund to cover the current budget shortfall.

Cuts – General
“They need to cut…I’m sorry but I’m not paying for services that probably need to be cut” - woman
“We don’t have that luxury (to not cut anything)” – woman
“They’ve been cutting every year for how long?” - woman
“In my house when the money gets short you have to make cuts somewhere” - man

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January 2010 Tulsa, OK Focus Groups

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Specified Cuts – Education
“Really? That’s how much education gets” – woman
“They have cut education to the point that it is just obscene” - woman
“At this point I don’t think that’s the best interest of the citizens or the children” - woman
“All we’ve heard about are the cuts to education…that’s where they first cut” - woman
“If there ever is a shortfall, the first place they cut is education” - woman
“Education should not be cut to fill transportation” - woman
“If you take that all from education that’s bad news” - man
“Cut the top end of education like administration” - man

Specified Cuts – Health

“You don’t hear about health getting cut…what health?” – woman

Increase Revenue - General

“I would be ok with tax increase if I have seen every other option exhausted” - woman
“How can you just keep taxing the people here” – woman
“I don’t mind paying more taxes if there was no other option” – woman
“If you lower the tax, you’ll have to increase it back up the next year” – woman
“Definitely not new taxes” - man
“If you cut a salary and then you tax it more what do you have left?” - man
“Tax the rich” - man
“Create new jobs which will increase revenue” - man
“People aren’t spending a lot because they don’t have the money” - man
“It’s hard for me to raise taxes” – man

Increase Taxes – banks/bank bonuses

“Anything they increase will be ours” - woman
“It will be passed onto us” – woman
“Can’t tax the top because they will turn around and tax you back” – man
“I agree with that” - woman

Increase Taxes – insurance companies

“That’s who they should cut, insurance companies” - woman
“Insurance companies have way too much control” – woman

Rainy Day Fund

“Just released rainy day funds…question is when do they get it, like now when we need it or later” -
woman
“How many hands does it have to go through until they get it” – woman
“What is the rainy day fund for if not for these times and this crisis?” - woman
“It’s enough to offset some of this deficit” – woman

Report to Oklahoma Consumer Defense Fund

January 2010 Tulsa, OK Focus Groups

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 OKLAHOMA BUDGET SHORTFALL PROPOSALS
Participants were given a list of proposals regarding fixing the budget shortfall. The following are ranked
by support (full text of proposals in appendix):

Currently the state has enacted 5% budget cuts across the board for all agencies
in the state but there is still a shortfall. Which of the following proposals do you
support most regarding fixing the remaining budget problems? Please rank each
proposal from 1 to 10, with 1 meaning you strongly oppose it and 10 meaning
you strongly support it.
Average Score
Proposal Title
(out of 10)
Health Insurance Reform 7.5
Restructure Workers’ Compensation 7.3
Privatize CompSource 5.8
Across the Board Cuts 5.8
Consolidate Schools 5.7
Create an Office of Accountability and Innovation 5.3

To fix the remaining shortfall this year, participants tended to support reforming current industries,
mainly changes to the health insurance system in Oklahoma and restructuring workers’ compensation.
There are similarities to both proposals as they highlighted creating opportunities for more business
growth in Oklahoma. Participants generally believed that with more business growth, more revenue will
be generated in the state. Any option to lower costs for businesses and create jobs is therefore
considered a benefit to the state and the budget. These two proposals meet two goals at once,
generating revenue for the state and diversifying the economy.

Participants were more supportive of proposals that plan for the future of the state rather than immediate
quick fixes. “Privatizing CompSource” and “Across the Board Cuts” are viewed as a one time, this year
only, type of option that will not continue to raise revenue for the state. The men said, “That’s just a
one-time deal” and “it’s short sighted.” One woman echoed the men’s sentiment, “there has to be a
catch with that” while another stated “it’s a continued source of revenue for the state” referring to
CompSource and its ability to bring money to the state that would be lost with privatization. Increasing
the across the board cuts to 10 percent was also viewed as a one-time only quick fix, and participants
were also wary of what will happen to all agencies if they have to maintain lower budgets in the future.

School consolidation was received with lukewarm support. Closing schools represents a loss of
community to many rural participants. However, for the participants from urban areas, they often see
consolidation as a way to reduce costs by combining administrative level positions without harm to
education quality. Most of the rural participants are very skeptical of consolidating their schools in fear
that community values will be lost within a larger bureaucracy if the local schools are closed. One
woman said, “the reason we bought the house where we did was because of the school district…I don’t
want my kids getting lost in the bureaucracy of larger school districts” while another woman questioned
“how would that help?”

However, if school consolidation is defined as a means to lower administration costs, participants (mainly
urban) are more supportive. They also see that there are some increased costs which may be
outweighed by the total savings, as one man stated, “If you take three smaller school districts and make
them into one, you will save on administrative costs but transportation costs will go up…but the costs you
save overall will offset the increase in transportation.”

Report to Oklahoma Consumer Defense Fund

January 2010 Tulsa, OK Focus Groups

15
Creating an Office of Accountability and Innovation was the least supported proposal. One woman said,
“It’s another expense and bureaucracy” while a man echoed “you’re going to start a whole new agency to
start another agency.”

Proposal – Health Insurance Reform

“I would be worried how insurance would take it” (fear of repercussions) - woman
“We have a small business, if my husband didn’t have insurance from where he retired, we would be in
real trouble” - woman
“It’s outrageous, insurance companies shouldn’t have that much control” – woman

Proposal – Restructure Workers’ Compensation

“More friendly to out of state businesses to create revenue” - man
“if you can make the state look more economically pleasing to companies, even if they are going to
relocate from out of state, they are going to be more prone to come here” – man
“Whatever it takes to get in new businesses then I’m for it” - man

Proposal – Privatize CompSource

“There has to be a catch with that” - woman
“It’s a source of revenue for the state” (didn’t want to sell) – woman
“That’s just a onetime deal” - man
“It’s short sighted” - man
“You are losing control of an entity” - man

Proposal – School Consolidation

“Some don’t have enough money to finish the year out” - woman
“I didn’t really care for it, my children are in a small school district…I would not be happy with that” –
woman
“I prefer the smaller school districts” - woman
“How would that help” – woman
“It would totally affect my community” - woman
“I like to think if it affects my state, it affects me” – woman
“The reason we bought the house where we did was because of the school district…I don’t want my kids
getting lost in the bureaucracy of larger school districts” – woman
“I think the children will get the shortfall in the end” – woman
“Our teachers are on the very low end of the pay scale which means we get the very end of the scale” –
woman
“You’re talking about taking a small town school and closing it and sending it away?” - man
“If you take 3 smaller school districts and make them into one, you will save on administration costs and
transportation costs will go up…the costs you will save from administration cuts offset transportation
costs” – man

Proposal – Office of Accountability

“Where would the money come from for this?” - woman
“Who would be in charge” - woman
“It’s another expense and bureaucracy” - woman
“You don’t have quality and efficient people doing that already…why should I pay more for that” - woman
“It seemed like a good idea when I read it, now I’m against” – woman
“You’re going to start a whole new agency to start another agency” – man

Report to Oklahoma Consumer Defense Fund

January 2010 Tulsa, OK Focus Groups

16
 APPENDIX – TEXT OF PROPOSALS

Ranked by Support

HEALTH INSURANCE REFORM

Put restrictions on health insurers’ premium costs to reduce the cost of insurance for businesses and
individuals. Oklahoma has no limits on how much insurance companies can vary premiums based on an
individual’s health status. These restrictions would lower costs for businesses which could allow existing
business to grow and attract new jobs to Oklahoma.

RESTRUCTURING WORKERS’ COMP

Restructure the workers’ compensation system to reduce costs for business while still protecting workers
injured on the job. The overhaul would improve employee benefits and lower business expenses, making
Oklahoma more attractive to new industry development and raising more money for the state.

PRIVATIZE COMPSOURCE
Sell CompSource, the state-owned workers’ compensation insurance provider, to a private company.
CompSource is the largest workers’ compensation insurer in the state. Oklahoma could potentially gain
$150 million to $200 million from the sale.

ACROSS THE BOARD CUTS

Increase the across the board budget cuts from 5% to 10% for all agencies in the state. No organization
would be favored over another and the state could cover a large portion of the shortfall.

SCHOOL CONSOLIDATION
Consolidate smaller schools into larger school districts to reduce administrative costs so money can be
used directly in the classroom instead of toward local bureaucracies.

CREATION OF OFFICE OF ACCOUNTABILITY

Create an Office of Accountability and Innovation to conduct independent performance audits to make
sure the government is running efficiently and on budget. The Office of Accountability would increase
the role of the State Auditor and Inspector’s Office to seek out wasteful spending and make cuts where
appropriate.

Report to Oklahoma Consumer Defense Fund

January 2010 Tulsa, OK Focus Groups

17