Fantastic news for the taxpayer

It is perhaps the best news from this legislative year and a reform for which legislative and state leaders should rightly take credit. It could represent the key turning point in a return to ethical governance and restore a balance in favor of Oklahoma taxpayers and away from special interests.

Every year I have observed special interest raids on the public treasury through the creation or expansion of tightly targeted (essentially hidden) tax credits, other giveaways and new corporate welfare programs. Those who advocate for these raids disguise them with talking points like, “This will bring new jobs to Oklahoma and we must compete against the other states for jobs.”

This superficial logic shrugs off the ethical implications of the proposal in question. Many times that logic, once coupled with lobbyist influence, has been all that is necessary for legislators to support the proposal.

Once these programs are approved, those who have specific knowledge of them reap the benefit; a benefit not readily available to their competitors. The taxpayer foots the bill.

Writing for the Oklahoma Watch website, Warren Vieth and Edmond resident Mark Lash recently penned an excellent article detailing one of these programs. You may read their story at hd31.org/741. Vieth and Lash walk the reader through the impact of the program, initially approved by the Legislature in 2009 and mostly invisible to the public ever since.

Thanks to the great investigative work of Vieth and Lash, we now know that the secretive program will allow just 17 companies to potentially receive $89.2 million in tax revenue. Though the size of this impact might startle the reader, it is just one of a number of similar programs which have been routinely approved by the Legislature in recent years.

By allowing these special interests raids on the treasury, the current generation of elected officials has created a tax code riddled with loopholes and giveaways, made the Legislature extremely vulnerable to ongoing special interest influence, and provided a great benefit to those who have the resources to employ sophisticated lobbyists, lawyers and accountants to the detriment of the hard working, average taxpayer who isn’t represented by any of these entities.

Things were different this year!

I am not aware of the creation of a single new giveaway or corporate welfare program. In April I wrote about one such proposal, Senate Bill 647, which almost made it through the Legislature; however, on final passage, the House defeated it in a lopsided vote of 23-67.

Better still, the Legislature showed the first signs of getting a handle on the many existing giveaways and programs. They passed legislation to finally provide a modicum of oversight for existing corporate welfare tax credits.

It’s not yet clear if the Legislature’s new, ethical stance is temporary, driven by necessity in response to a down appropriations year, or an actual sign of a shift in ethics.

Readers are well advised to remain skeptical as the Legislature has previously shown an impetus for doing the right thing only to reverse course and delve back into irresponsible behavior.

For instance: in 2013, the Legislature both rejected any new debt issuance and passed legislation to limit the abuse of debt issuance. The proclivity of state officials to repeatedly issue millions in debt had terribly compromised their purported commitment to fiscal conservatism. 2013 appeared to represent a key turning point in the ethics of the institution. It wasn’t! In 2014, the Legislature returned to its old ways and has since opened the floodgates on debt issuance. The bonds approved in 2014 had a devastating effect on this year’s budget. I intend to describe the specifics of this impact soon.

This caution noted, the tax credit reforms of this year were meaningful and could forever restore the balance of Oklahoma’s fiscal policy in favor of the taxpayer instead of the special interests.

Thank you for reading this article. Your interest and input are much appreciated. Please do not hesitate to email [email protected] with your thoughts and suggestions.