Poll results concerning business incentives and tax breaks create conversation

In July, SoonerPoll conducted the third Quarterly Poll of 2011. The Quarterly Poll is designed to give individuals or organizations interested in how the public views issues important to them.

Considering the amount of attention the newly created Task Force for the Study of State Tax Credits and Economic Incentives has received in recent months, it is not surprising that multiple organizations had an interest in asking the public about tax breaks and other business incentives.

In a recent editorial in the Journal Record, M. Scott Carter compared responses to tax break related questions commissioned by two different organizations, The State Chamber of Oklahoma and Oklahoma Watch.

In a question commissioned by The State Chamber of Oklahoma voters were asked if Oklahoma should continue to offer business incentives to help attract and retain jobs and investment. Results revealed that 85.3 percent of likely Oklahoma voters think the incentives should be continued.

However, results from a series of questions commissioned by Oklahoma Watch indicate 61.4 percent of those polled were unfamiliar with Oklahoma's tax breaks while 33.9 percent hold a negative opinion of Oklahoma's tax breaks.

In his editorial, Carter made a compelling argument highlighting what he perceived to be potential inconsistencies in the latest SoonerPoll. More specifically Carter focused on the fact that 85.3 percent of respondents said business incentives should be continued, while two in three respondents were unfamiliar with the tax breaks and one in three held negative opinions of Oklahoma's tax breaks.

"I find it hard to believe that a supermajority of Oklahomans can say they want tax incentives while, at the same time, say they are not familiar with the system," Carter wrote. "Further, 43 percent of those surveyed said they had no opinion about tax breaks; 19 percent said they had a somewhat negative opinion and 14 percent had a very negative opinion."

Carter strengthened his case by addressing results from another Oklahoma Watch commissioned question which indicate that 35.8 percent of respondents think no individuals, corporations, interest groups or associations should receive tax breaks.

Oklahoma Watch reported that despite unfamiliarity, 'three in four respondents either opposed tax breaks altogether or said the state should stop letting recipients sell their credits to other people."

'If three in four are opposed to tax breaks, that's not a supermajority," Carter wrote.

Carter's analysis of the results raises some interesting points and we thought it might be helpful to add additional data and analysis to the ongoing conversation about how likely voters in Oklahoma perceive tax breaks and what they would like to see from lawmakers moving forward.

The table below shows a cross-tabulation of responses to the question concerning the continuation of business incentives and respondents familiarity with Oklahoma's tax breaks. The table indicates that 62.1 percent of those who said business incentives should be continued are unfamiliar with the tax break system.

Offer Business Incentives to Attract and Retain Jobs? (Yes, No, DK/Refused)

Familiar with Tax Breaks 29.5%, 41.5%, 28.6%
Unfamiliar with Tax Breaks 62.1%, 56.9%, 57.1%

Carter's concern seems to be the fact that 62.1 percent of the electorate are willing to make decisions on issues they are unfamiliar with. His concern is important and the above chart provides valuable further analysis, however the results can be interpreted in multiple ways.

The results indicate that a supermajority of likely voters do feel that the state of Oklahoma must offer some sort of business incentives to attract and retain jobs. But when asked specifically about tax breaks, which are only one form of possible business incentives, they admit to being unfamiliar with the current system.

When examined in this way, the perceived inconsistency actually helps us better understand the results. However, it is perhaps useful to examine the opinions of only the informed voting public. The table below reveals that when the results are broken down by familiarity, 81.8 percent of the 181 respondents who said they were familiar with tax breaks also said Oklahoma should continue to offer business incentives.

Offer Business Incentives to Attract and Retain Jobs? (Yes, No, DK/Refused)

Familiar with Tax Breaks 81.8%, 14.9%, 3.3%

The next table shows a cross-tabulation of responses to the continued business incentive question and opinion of Oklahoma's tax breaks. Analysis of the table reveals that 31 percent of respondents who favor offering incentives to attract business have a negative opinion of Oklahoma's tax breaks.

Offer Business Incentives to Attract and Retain Jobs? (Yes, No,DK/Refused)

Very positive 5.4%, 3.1%, 0%
Somewhat positive 18.6%, 7.8%, 14.3%
Neutral/No Opinion 45.1%, 29.7%, 57.1%
Somewhat negative 17.8%, 28.1%, 23.8%
Very negative 13.2%, 31.3%, 4.8%

Since respondents were not asked why they hold a positive or negative opinion about tax breaks, it is hard to say with any certainty exactly why that 31 percent both favor continued incentives and have a negative opinion of tax breaks. One possible explanation is that some respondents feel business incentives are a must to keep Oklahoma competitive, but that, for any number of reasons, the current tax break system should be reformed.

Another possible explanation for inconsistency builds on a conclusion drawn earlier in this article concerning how the diverging language used in the poll questions must play a role in how we analyze the data. The questions commissioned by Oklahoma Watch were specifically focused on tax breaks, while the question commissioned by the State Chamber of Oklahoma was designed to measure public opinion on business incentives, which includes both tax breaks and nontax incentives. While the temptation to compare the results of these two questions is great, it is also problematic.

A case could be made that many likely Oklahoma voters do not immediately associate the term "business incentives" with tax breaks. It is quite possible that many of the respondents who support business incentives and oppose tax breaks could be supporters of nontax business incentives. This scenario seems especially possible, considering how much media attention some nontax incentives received in months prior to the poll.

For example, one piece of legislation that received much media attention in the 2011 legislative session was HB 1953, which created the Oklahoma Quick Action Closing Fund when it was passed in May. The Quick Action Closing Fund, which has recently become a point of controversy, is designed to help the state of Oklahoma close important economic development deals and is just one recent example of a nontax business incentive in this state.

This explanation must also be applied to another potential inconsistency mentioned in Carter's editorial and one that appears, at first glance, to be more damaging than the rest. As the table below shows, 33.1 percent of respondents who said Oklahoma should continue to offer business incentives to help attract and retain jobs also said no individuals, corporations, interest groups or associations should receive tax breaks.

Offer Business Incentives to Attract and Retain Jobs? (Yes,No, DK/Refused)

Some should receive tax breaks 53.9%, 32.3%, 33.3%
No one should receive tax breaks 33.1%, 56.9%, 33.3%
Don't Know/Refused 13.0%, 10.8%, 33.3% 

This example only further indicates that, for the average likely Oklahoma voter, a disconnect exists between business incentives and tax breaks, which again highlights the need for caution when comparing poll questions with divergent language.

It is interesting to note, that a 53.9 percent majority of those who favor continued business incentives also think that some no individuals, corporations, interest groups or associations should receive tax breaks.

Carter's mention of the "three in four respondents [that] either opposed tax breaks altogether or said the state should stop letting recipients sell their credits to other people" is accurate. Now that we have examined the 33.1 percent of respondents who were against tax breaks and for business incentives, we should turn our attention to the other portion of the three in four respondents mentioned in the article.

More than half of those three in four respondents said some should receive tax credits but that transferable tax breaks should be rewritten. Since you can be for business incentives and against transferable tax credits, this figure, like the figures concerning unfamiliarity we addressed earlier, is not really useful as an argument against the legitimacy of the poll.

Any time multiple organizations commission questions about similar subjects on the same poll, there lies the possibility of polling inconsistencies. In a time when many polling companies are affiliated with political parties and unscientific polling is prevalent, it is important to read results carefully and SoonerPoll welcomes conversation about results.

Many times, as is the case here, further analysis of the data reveals that what, at first glance, appear to be inconsistencies are not hindrances to the truth but opportunities to find out more about the opinions of poll participants and why they respond the way they do.

A version of this article was printed in the Journal Record.