Can Oil Tax Save Schools?


It's understandable that advocates for California schools have filed a ballot initiative to impose an oil severance tax to fund education. Schools have taken years of budget hits. And California is the only oil-producing state without a tax.

But early signs are that the proponents are repeating a big previous mistake made by sponsors of a ballot initiative imposing a state lottery more than 25 yeras ago. in 1984, voters were asked to enact the lottery to provide school funding. They did, and to this day, Californians tell pollsters and focus group leaders that they shouldn't have to pay more taxes for schools. They took care of that with lottery.

Here's the problem: The lottery produces a little more than $1 billion a year -- or about 2 percent of state spending on K-14 schools. Since the lottery passed, California school funding -- compared to that in other states -- has dropped precipitously. It's possible that the lottery made it harder to convince voters to give more to education, not less.

This new oil tax would produce $3.6 billion a year -- but that money would be divided between K-14 and the state university systems. Public schools might get 7 percent of their budgets -- good but not a panacea.

But if history serves, voters -- if they were to approve such a tax -- might come to believe they had done more for schools than they really had. Which is why this method of school financing may produce little net gain for schools.

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