More About Phil Oliff

Phil Oliff

Oliff joined the Center as a Policy Analyst with the State Fiscal Project and his work includes tracking state revenue collections and property tax issues, among other areas.

Full bio and recent public appearances | Research archive at

States Have Hiked College Tuition to Compensate For Cuts

March 22, 2013 at 1:41 pm

States have slashed funding to public colleges and universities over the past five years, as I explained earlier this week and we detail in our new paper.  After adjusting for inflation, every state except North Dakota and Wyoming is spending less per student on higher education — 28 percent less, on average — than they did before the recession.

Consequently, as the chart below shows, the schools have increased tuition to help make up for lost state revenue.  As a result, the average cost of attending a public college or university has surged.

Average annual published tuition at four-year public colleges — the “sticker price” — has grown by $1,850, or 27 percent, in real terms between the 2007-08 school year, the academic year that began just prior to the recession, and the current 2012-13 school year.

Tuition increases have been both substantial and widespread.  Since the 2007-08 school year, after adjusting for inflation, the average tuition at public four-year colleges has increased by:

  • More than 50 percent in seven states;
  • More than 25 percent in 18 states; and
  • More than 15 percent in 40 states.

Two states, Arizona and California, have increased tuition by more than 70 percent.

Click here to read the full paper.

Adding Up Five Years of State Higher Ed Cuts

March 19, 2013 at 9:52 am

State cuts to higher education funding in the last five years have been severe and almost universal, as we explain in a new paper.  After adjusting for inflation:

  • States are spending $2,353 or 28 percent less per student on higher education, nationwide, in the current 2013 fiscal year than they did in 2008, when the recession hit.
  • Every state except for North Dakota and Wyoming is spending less per student on higher education than they did before the recession.
  • Eleven states have cut funding by more than one-third per student, and two states — Arizona and New Hampshire — have cut their higher education spending per student in half (see chart).

Deep state funding cuts have major implications for public colleges and universities.  States (and to a lesser extent localities) provide 53 percent of the revenue that is used to support instruction at these schools.  When this funding is cut, colleges and universities generally must either cut spending, raise tuition to cover the gap, or both.

That’s just what they’ve done.  Over the last five years, public colleges and universities have both steeply increased tuition and pared back spending, often in ways that compromise the quality of the education that they offer.

Reversing these trends and reinvesting in higher education should be a high priority for state policymakers.  A large and growing share of future jobs will require college-educated workers.  Investing in higher education to keep tuition low and quality high at public colleges and universities, and to provide financial aid to students who need it most, would help states to develop the skilled workforce they will need to compete for these jobs.

But to strengthen state investment in higher education, state policymakers will need to make the right tax and budget choices over the coming years.  The weak economic recovery and the need to reinvest in other services that also have been cut deeply means that many states will need to raise revenue to rebuild their higher education systems.  At the very least, states must avoid shortsighted tax cuts, which would make it much harder for them to invest in higher education, strengthen the skills of their workforce, and compete for the jobs of the future.

Click here to read the full paper.

State Tax Cuts Jeopardize Schools

January 15, 2013 at 4:05 pm

Deep state tax cuts can be very, very bad for K-12 schools.  That’s a key lesson of last week’s court ruling that found that Kansas is unconstitutionally underfunding its elementary and secondary schools even as it slams through one of the nation’s largest-ever state tax cuts.  And it’s a lesson that the surprising number of governors who are considering tax cuts as they unveil their budgets for next year should heed.

The connection between schools and taxes is not complicated.  States need a well-educated workforce for economic growth.  That means adequate funding in order to recruit and train new teachers and to make other improvements to state school systems.  The constitutions of most states, including Kansas, also require adequate school funding.

But states won’t have enough money for schools if they blow holes in their tax codes.  Earlier this month, Kansas slashed income tax rates and gave huge new tax breaks to many of the state’s wealthiest individuals and corporations — even though it has made some of the deepest education funding cuts of any state, cutting per-student aid to local school districts by 13 percent, in real terms, since the start of the recession.

Kansas claimed that the funding cuts were the inevitable result of a weak economy, but a panel of district court judges said that argument was “completely illogical” in the face of its huge tax cuts.  And to the state’s argument that cutting taxes would help the economy, the court said, “the only certain result from the tax cut will be a further reduction of existing resources available.”  Indeed, the state now faces a $267 million gap in its budget for the coming year.

Kansas Governor Sam Brownback is not the only governor who has been pushing big tax cuts.  Governors in Indiana, Wisconsin, and New Mexico also are talking tax cuts, often implying that such cuts will pay for themselves through greater economic growth.  In fact, research shows that state tax cuts are at best a weak tool for economic advancement.  A better idea:  follow the requirements of state constitutions, restore education funding, and invest in states’ most promising economic asset — children’s education.

Out-of-State Companies Win, Local Services Lose Under Florida Tax Cut

October 5, 2012 at 1:35 pm

We recently explained that Amendment 4, a package of harmful property tax changes on Florida’s November ballot, would send millions of dollars in property tax breaks out of state instead of using that money locally to pay for police and fire protection, road maintenance, and other public services.

Indeed, some of Amendment 4’s biggest likely beneficiaries would be large corporations headquartered in other states, with out-of-state owners and shareholders.  For example:

  • Some of the largest property taxpayers in Orange County, which includes Orlando, are The Walt Disney Company (headquartered in California), NBCUniversal (New York), Hilton Hotels & Resorts (Virginia), Lockheed Martin (Maryland), and AT&T/Bell South (Georgia).
  • Some of the largest property taxpayers in Hillsborough County, which includes Tampa, are Verizon (headquartered in New York) and Wal-Mart/Sam’s Club (Arkansas).

Amendment 4 would limit the annual growth in the taxable value of properties that are not primary residences to 5 percent.  So, in years when market property values rise faster than 5 percent, these sorts of corporations would reap millions of dollars in tax benefits.  Real estate values in Florida have plummeted in recent years, but over the 30-year period from 1976 to 2006, they grew by about 8 percent a year.

How much money would Amendment 4 send out of state?  No one knows, but a cursory glance at property tax records and some simple math suggest that the amounts would be large.

For example, as of 2011 Walt Disney owned property with an assessed value of $6.45 billion in Orange County.  If the value of that property grew by 7 percent a year for two years, by the end of the second year the county would be giving $1.2 million per year (assuming current tax rates) — enough to pay the salaries of 23 police officers at the state’s average annual police salary — in Amendment 4 tax breaks to Disney.  NBCUniversal, Hilton, and other out-of-state corporations  would get millions more in total property tax breaks, with the benefit accruing to their shareholders and investors, most of whom presumably live outside Florida.

Property taxes are the single largest revenue source for Florida’s local governments, providing 60 percent of counties’ general fund revenues and 42 percent of cities’ revenues.  Florida would be far better off keeping that money in the state and using it to sustain local services like police and fire protection and road maintenance, whose funding has fallen severely in recent years due to the housing crash and previous tax cuts.  That would be better for the state’s economy and for Floridians’ quality of life.

Double Trouble in Florida

September 28, 2012 at 2:26 pm

As we note in recent analyses, Florida’s November ballot will contain two measures, Amendment 3 and Amendment 4, each of which would severely squeeze funding for local services like schools, roads, and fire and police protection.  Their combined impact would be even more dramatic.

  • Amendment 3 would limit annual state revenue growth under a formula that can’t keep pace with the normal costs of maintaining existing public services over time.  In Colorado, the only state that tried such a formula, it led to drastic cuts in services.

    Amendment 3 would inevitably drive down state funding for education.  This would create serious problems for local school districts, which get over half of their funding from the state.

    Florida’s police and fire departments and other local services also depend on state support.  By forcing steep cuts in state revenues, Amendment 3 would almost certainly erode this support, damaging local budgets and causing significant local service cuts, tax increases, or, most likely, both.

  • Amendment 4 would lock a series of misguided property tax changes into the state’s constitution, reducing the taxable value of certain types of property.

    Since property taxes are the main funding source for local services like fire and police protection, the only way that localities could preserve these services would be to raise property tax rates.  Basically, localities would have to raise taxes on those who benefit least from the amendment (primarily established, year-round Florida homeowners) to pay for tax cuts for those who benefit most from the amendment (primarily large corporations and other businesses and owners of properties that are not primary residences, like vacation homes).

    To the extent that local governments didn’t offset the revenue losses from Amendment 4 by raising property tax rates, the measure would take a large and growing bite out of funding for local services.  At current rates, the local revenue loss each year would grow to $471 million by 2016 — the equivalent of 7,656 police officers at the state’s projected average annual police salary that year.

If both measures win approval, the impact on localities would be especially severe:  Amendment 4 would cut local revenues directly, and Amendment 3 would cut them indirectly by reducing state aid.  But either measure would, in all likelihood, lead to some combination of increases in local taxes and cuts to local services.