A rural leader with a successful background in economic development says a tax break for newcomers is a “backwards way” to grow rural Oklahoma.

Senator Jay Paul Gumm (D-Durant), said proposed amendments to the bill intended to help bring the Seattle SuperSonics to Oklahoma City would create a “grossly unfair” tax scheme in which current residents of the state pay more income tax than newcomers.

The proposal, advocated by some rural legislators, is called the “Come Home to Oklahoma” bill, and would give a five-year income tax exemption to people who move into some rural areas from another state and buy or build a home there. Under the proposal, individuals who already live in Oklahoma would continue to pay their full income tax bills:

I do not know how any leader can look his or her constituents in the eye and tell them they should pay more tax than someone who just arrived in Oklahoma. We ought to call this the ‘Oklahomans Pay More Taxes’ bill. It is unfair, potentially unconstitutional, and nothing short of a ‘deal-breaker’ for me.

Gumm is the former executive director of the Durant chamber of commerce. According to records from the last five years, Durant has attracted a higher percentage of new jobs than any community in Oklahoma. The experience of his hometown, he said, shows the newcomers’ tax break does not make sense from an economic development standpoint. He added:

While we need an adequate workforce to attract business and industry, jobs rarely follow people; people follow jobs. If we attract residents to these areas before there are jobs for them, then the problem this idea attempts to solve is made even worse.

Gumm said a better way to encourage rural legislators to support the “Sonics” bill is to make a significant investment in rural Oklahoma’s infrastructure. One way to do that would be through the Rural Economic Action Program, which provides grant money to small communities for economic development and infrastructure improvements:

It is woefully under funded at only $15 million annually. Pumping an additional $20 or $30 million into REAP, spread across the state to deserving communities, stands a better chance of growing small town economies.

It doesn’t matter how many people move to rural Oklahoma if the infrastructure is not adequate and there are no jobs. Build the infrastructure, create the jobs and the people will come.

In a recent edition of Gumm’s regular column to his constituents, the lawmaker wrote the idea behind the “Come Home to Oklahoma Act” was noble, but that proposal is “as patently unfair” as any bill he has ever seen. Gumm

Tax policy says who we are and who we value. This wrong-headed proposal says we value newcomers more than we do the people who have already invested in our state. I cannot and will not support any plan to puts lesser value and higher taxes on the people I represent.

Also see: Come Home to Oklahoma (Please? We'll Give you a Tax Break)

Labels: Rep. Jeff Hickman, Sen. Gumm, Tax Cuts, tax increases, taxes

Posted at 4/14/2008 08:02:00 AM