The Great Recession of 2008 exposed municipalities across the U.S. to the
dangers of over-reliance on a volatile sales tax base for general revenue financing. A
2010 interim study convened by the Oklahoma Legislature examined the possibility
of offering access to the property tax base as a source of municipal general revenue.
The feasibility of such a move depends crucially on understanding the economic
incidence of the local property tax. Current research is divided on the issue, with one
school proposing the property tax as a tax on capital generally (the capital tax view)
and the other asserting the property tax as a user-fee for locally provided public
services (the benefit view). We examine the incidence of the local property tax in
Oklahoma County recognizing explicitly that the tax levy is really an aggregate of
independent levies — each tied to the provision of a specific subset of local services
— and that incidence outcome may vary by jurisdiction. An analysis of the 19 independent
school districts in Oklahoma County over a 10-year period finds evidence
that the incidence of the property tax varies both by levy and jurisdiction.