Small: Oklahoma needs regulatory reform

Oklahoma needs regulatory reform

By Jonathan Small

A major focus of this year’s legislative session centers on reducing excessive government regulation.

House Bill 2728, by state Rep. Gerrid Kendrix and state Sen. Micheal Bergstrom, would create the Regulations from the Executive in Need of Scrutiny (REINS) Act of 2025.

Under the bill, any state agency rule with an economic impact of $1 million or more over a five-year period would face extra scrutiny and oversight from the Legislature.

Yet some question why Oklahoma needs this reform. The answer is simple: Because Oklahoma state agencies are as prone to overreach as government agencies in other parts of the country.

Op-ed: The dangers 'school choice' brings to the homeschool community

The homeschool community in Oklahoma has entered a new era, one in which the specter of government regulation is closer than ever before due to the 2023 passage of the Parental Choice Tax Credit, which includes a $1,000 credit for homeschool families.

I've written before about the wariness homeschoolers have for government strings (here, here, here, here, here, here, here, and here). As the saying goes, with the shekels come shackles. As a result, many homeschoolers in Oklahoma (me included) are declining to take the "free* money!" offered by the latest government Pied Piper. Don't be a party in laying the groundwork for infringement on educational freedom. The camel's nose is now under the tent.

 

Image by wirestock on Freepik

THE DANGERS SCHOOL CHOICE BRINGS TO THE HOMESCHOOL COMMUNITY

by Robert Scott

Our freedoms are rarely eroded in one fell swoop. Like the frog in boiling water liberty is lost in baby steps. Participating in the school choice tax credit will impact us all. Simply not taking the tax credit is not enough. All forms of government money (subsidies, credits, grants, incentives, welfare) are a means to control the people.

The Taxpayers Guide to Tax at the Grocery Store

As the state grocery sales tax is phased out today, here's a helpful video from the Oklahoma Tax Commission: The Taxpayers Guide to Tax at the Grocery Store.

Additional information from the Tax Commission with FAQs for consumers and vendors can be viewed here.

AFP comments on OK Tax Commission's proposed rules for Parent Choice Tax Credit Act

With the passage of HB 1934 and signing by Gov. Stitt, landmark 'school choice' legislation is now law in Oklahoma, providing tax credits of $5,000-$7,500 for private school students (depending on household income) and $1,000 tax credits for homeschool students (with a cap of $5,000,000, or 5,000 students for now, though estimates put the Oklahoma homeschool student population from a low of 25,000 to 120,000 on the high end). 

A relatively little-known aspect of law and government is that state and federal agencies must develop and publish rules to put most legislation into effect. Typically, there is a public comment period for citizens to have some input on the impact of proposed rules before the rules are finalized (and in some cases sent to the legislative branch for approval).

John Tidwell, State Director for Americans for Prosperity Oklahoma (which advocated very heavily for the bill), submitted the following letter during public comment on the proposed rules put forth by the Oklahoma Tax Commission:

CUT OUR TAXES: Record state tax collections exceed expectations, bring Rainy Day Fund to all-time high

Another year, another record amount of money taken from the taxpayer and stuffed into the bottomless moneypit of state government. Oklahoma government is addicted to increasing spending year over year at the expense of the governed.

Having a state "savings account" is fine and dandy, but at a certain point, it's borderline criminal to take money that is not needed from the taxpayers. It's high time that Oklahoma taxpayers received some actual relief in the form of a tax cut. 

GOVERNOR STITT ANNOUNCES FY 23 REVENUE EXCEEDS EXPECTATIONS, DEPOSIT MADE TO RAINY DAY FUND

OKLAHOMA CITY (August 3, 2023) - Governor Stitt announced today the General Revenue Fund collections for fiscal year 2023 exceeded expectations and totaled $9 billion, which is approximately $1.6 billion, or 21.2%, above the estimate, and $493.7 million, or 5.8%, above prior year collections for the same period.

"Not only does this accomplishment stand as a testament to the benefit of our conservative fiscal policies, it represents the strength of our economy, the success of our businesses, and the hard work of Oklahomans," said Governor Stitt. "Oklahomans know how to spend their money better than the government, so let's leave more in their pocket. With a record $1.3 billion in the Rainy Day Fund and continued growth in our savings, there has never been a better time to cut taxes."

Mark Wood appointed as new Oklahoma Tax Commissioner

GOVERNOR STITT APPOINTS MARK WOOD AS OKLAHOMA TAX COMMISSIONER

OKLAHOMA CITY (Nov. 22, 2021) – Governor Kevin Stitt has appointed Mark Wood to serve as Oklahoma Tax Commissioner. Wood’s appointment fills the vacancy created by the resignation of Clark Jolley.

“Mark brings a wealth of tax experience from his impressionable career spanning over nearly four decades in the private sector,” said Governor Stitt. “I have every confidence in his ability to serve Oklahomans well in this new role.”

“I am honored to be appointed by the governor to this position. I have worked in public accounting and tax for over 35 years. I look forward to utilizing this experience to serve the citizens and taxpayers of the State of Oklahoma. I will work with the other commissioners to ensure the OTC operates fairly and efficiently,” said Wood.

Former State Sen. Clark Jolley announces run for State Treasurer

Clark Jolley Launches Campaign for State Treasurer

Jolley to put extensive experience to work; Releases 10-point plan

(November 9th) Today, lifelong Oklahoman and longtime public servant Clark Jolley launched his campaign for State Treasurer by outlining his 10-point plan to propel the office forward.  His straightforward approach demonstrates his experience and the values that he believes are exactly what Oklahomans have come to expect from the position.  

“My experience as Appropriations Chairman, Secretary of Finance, and Chairman of the Tax Commission has uniquely prepared me to protect and safeguard taxpayers’ dollars,” stated Jolley.  

Jolley’s experience includes serving as State Senator in a key leadership role as Senate Appropriations Chairman, overseeing and negotiating five state budgets, none of which raised taxes on Oklahoma families.  In addition, Jolley served as Secretary of Finance, Administration, and Information Technology, where he successfully fought to protect the state’s bond rating from dropping during difficult economic times.  Jolley recently left the Oklahoma Tax Commission where he had been appointed Chairman by Governor Kevin Stitt.  While at the Commission Jolley also served as the Vice Chair of the Oklahoma Public Employees Retirement System, where assets grew by $2.5 billion (a 25% increase in funding) during his tenure. 

“Oklahoma’s State Treasurer should have the relevant experience to get to work on day one,” Jolley stated.  “Based on my experience and conservative values, I have developed a 10-Point plan for moving our state finances forward.” 

Cherokee Chief says no Oklahoma income tax for tribal citizens

CHEROKEE CHIEF SAYS NO OKLAHOMA INCOME TAX FOR INDIANS

by Ray Carter - Director, Center for Independent Journalism

Cherokee Nation Principal Chief Chuck Hoskin, Jr., said the U.S. Supreme Court’s decision in McGirt v. Oklahoma significantly increases the number of American Indian citizens who may now be exempt from paying Oklahoma state income tax.

“There’s nothing new about the law out there on the ability of a state to tax a member of a federally recognized tribe on a reservation,” Hoskin said. “What’s new of course is the scope of the reservation (because) of the McGirt case. So, we can look to existing law and we can see that taxation doesn’t attach to individual Native Americans who live on reservations.”

Hoskin made those comments as part of a panel on state tax-and-budget issues hosted by the Oklahoma Policy Institute.

The McGirt ruling found that the Muscogee Nation’s reservation was never disestablished. The ruling has since been expanded to include the reservations of the Choctaw, Chickasaw, Cherokee, Seminole, and Quapaw, a combined area that covers nearly half of Oklahoma. The affected area is home to roughly 2 million people of which 21 percent are estimated to be American Indian.

Members of federally recognized tribes have long been exempted from various forms of state taxation—if they live and work on tribal land. Prior to McGirt, that exemption covered only a small share of individuals working on much more geographically confined areas directly owned by Oklahoma tribal governments.

But under McGirt most of eastern Oklahoma is now considered reservation land, regardless of current ownership, potentially expanding the tax exemption to many more individuals. Hoskin conceded that may result in “revenue gaps” for state government.

Because of potential exemptions for tribal members on reservation land, the Oklahoma Tax Commission previously estimated that the McGirt decision could slash Oklahoma state tax collections by $72.7 million per year from reduced income tax collections and $132.2 million annually from reduced sales/use tax collections.

However, that estimate was based on McGirt applying only to the Muscogee, Choctaw, Chickasaw, Cherokee, and Seminole tribes. The Quapaw reservation has since been declared to have never been disestablished, and similar rulings could occur for other tribes now litigating reservation status.

State Sen. Murdock to file legislation to ease ag sales tax exemption renewal

Murdock to file legislation after findings of ag sales tax exemption interim study

On the heels of an interim study dedicated to examining Oklahoma’s agricultural sales tax exemption, Sen. Casey Murdock said he’s preparing to file a measure ahead of the next legislative session to make it easier for farmers and ranchers to renew their sales tax exemption card.

“When the Oklahoma Tax Commission (OTC) began requiring a Schedule F for agriculturalists to qualify for their sales tax exemption, we passed Senate Bill 422 to add additional documentation farmers and ranchers could provide to OTC in lieu of the Schedule F,” Murdock said. “After working with the tax commission, I’ve found these changes are working – there’s no backlog of producers getting their card, and denials are typically because the applicant hasn’t correctly filled out the form. However, we also learned the vast majority of the 110,000 ag sales tax exemption cards issued each year are renewals, so now we need a way to make the renewal process easier and more convenient.”

Murdock said his proposal will include an additional option on the agricultural sales tax exemption application that will allow the farmer or rancher to check a box if the application is a renewal, as well as confirm there’s no change to the agricultural operation from the prior year. If there’s no change, the renewal will be automatic.

Senate Finance Committee to study agricultural sales tax exemptions

Senate Finance Committee to study agricultural sales tax exemptions

The agricultural industry has a significant impact on Oklahoma’s economy, and Senate Agriculture and Wildlife Committee vice chairman Roland Pederson said it’s time to review who qualifies for agricultural sales tax exemptions in the state.

An interim study – “Finding a pathway for equitable farm tax exemptions” – will take a deep dive into this issue in the Senate Finance Committee on Monday, Sept. 13 at 10:30 a.m.

Pederson said the Oklahoma Tax Commission recently changed the process to getting an agricultural sales tax exemption card, and he’s heard from many farmers and ranchers from across the state who’ve had difficulties getting or renewing their exemption. Cards must be renewed every three years.  

“We need to conduct a fair assessment to verify legitimate farmers and ranchers when approving agricultural sales tax exemptions,” Pederson, R-Burlington, said. “While we don’t want to grant exemptions to individuals who don’t qualify and aren’t actually producers, we also don’t want to prohibit exemptions to those who are trying to make a living in ag.”

OK Tax Commission pushes income tax payment deadline to July 15th, filing still due April 15th

Governor Stitt announces Oklahoma Tax Commission to allow deferred income tax payments due to COVID-19

OKLAHOMA CITY (March 19, 2020) – Governor Kevin Stitt announced today the Oklahoma Tax Commission approved an order to allow all individual and other non-corporate tax filers to defer up to $1 million of state income tax (including self-employment tax) payments due on April 15 until July 15 without penalties or interest. This matches the federal guidance issued by the IRS as a result of President Trump’s emergency declaration pursuant to the Stafford Act, and also allows corporate taxpayers a similar deferment of up to $10 million of state income tax payments without penalties or interest.

The filing deadline remains April 15.

“This guidance is a proactive step to reduce the financial stress many hardworking Oklahomans and businesses are feeling during this time,” said Gov. Stitt. “I thank Executive Director Jay Doyle and the Oklahoma Tax Commissioners for working together with us to quickly approve this.”

Stitt appoints Charlie Prater as new head of OK Tax Commission

I must admit, this one caught me a bit by surprise. Charlie Prater, the financially-troubled losing candidate in the GOP primary/runoff for State Auditor, is the recipient of Gov. Stitt's latest appointment:

GOVERNOR KEVIN STITT ANNOUNCES NEW COMMISSIONER TO THE OKLAHOMA TAX COMMISSION

Oklahoma City, Okla. (February 14, 2019) – Governor Kevin Stitt announced today the appointment of Charles Prater as the next commissioner to the Oklahoma Tax Commission.

“Charles Prater has built a successful career in accounting and finance, and his knowledge and expertise will serve Oklahoma well as we work toward greater transparency and accountability in state government,” said Stitt.

“It is an absolute honor to be nominated as a Commissioner to the Oklahoma Tax Commission by Governor Stitt,” said Prater. “It will be my privilege and duty to serve the citizens of Oklahoma, the governor and his staff, and our Legislators in this capacity. I will work hard every day alongside the governor to help make Oklahoma a top ten state.”

Charles Prater currently serves as the President and CEO at Assurance Resource Company (ARC). A Certified Public Accountant, Prater has over 35 years of private sector experience in public accounting and as an executive officer and board member in a publicly-held regulated financial services company, receiverships, insurance arbitration, tax and strategic planning and audits. In addition to working at ARC, Prater has served as the Chief Financial Officer for Neuroscience Specialists and Compone Services, LTD, and the Vice President of UICI and CEO of their Insurance Subsidiaries.   Prater is a member of the Oklahoma Society of Certified Public Accountants, American Institute of Certified Public Accounts, and Leadership Exchange Academy Alumni. He holds a Bachelor of Science in Business Administration with a major in Accounting from Oklahoma State University.

Each of the three members of the Oklahoma Tax Commission is appointed to a six-year term by the Governor and confirmed by the State Senate. Currently, the Commission is comprised of Chairman Steve Burrage, Vice Chairman Clark Jolley and outgoing Secretary-Member Thomas E. Kemp, Jr. The commissioners are responsible for the supervision of the administration and enforcement of state tax laws and the collection of a majority of all state-levied taxes and fees.

Fallin appoints Clark Jolley to Tax Commission

Governor Mary Fallin Announces Oklahoma Tax Commission Appointment

OKLAHOMA CITY – Governor Mary Fallin today announced the appointment of former state Sen. Clark Jolley to the Oklahoma Tax Commission. He succeeds Dawn Cash, who resigned earlier this month.

Jolley’s appointment to the Tax Commission requires confirmation from the state Senate. His term would expire Jan. 10, 2023.

Jolley, of Edmond, serves as an adjunct professor at Oklahoma Christian University and Mid-America Christian University. He served in the state Senate from 2004 until 2016, the last five years as chairman of the powerful Senate Appropriations Committee. He could not seek re-election because of 12-year legislative term limits.

“Clark Jolley understands well the intricacies of our state budget and brings a vast knowledge of how taxes fund our state government,” said Fallin. “He realizes that our economy has shifted from manufacturing-based to services-based. He understands that the way we impose taxes and collect revenue no longer reflects our current economy, but instead an outdated system that has not changed much since the inception of Oklahoma’s sales tax in 1933. Clark will work to make sure taxpayer dollars are spent wisely, both in government agencies and as it relates to the state’s many tax credits and economic incentives.”

Jolley earned two degrees from Oklahoma Baptist University, a law degree from the University of Oklahoma, and a certificate in public treasury management from the National Institute of Public Finance at Pepperdine University in Malibu, Calif.

"It is an honor to serve the people of Oklahoma and I appreciate the governor’s confidence in my abilities to perform the duties as a member of the Oklahoma Tax Commission,” Jolley said.

He and his family make their home in Edmond, where his children attend Edmond Public Schools.

According to Fallin's Communications Director Michael McNutt: "if confirmed, Sen. Jolley would be paid $131,835 a year. All three commissioners are paid. Their salaries are tied to judicial pay, which is recommended by an independent commission and approved by the Legislature. The last pay change was approved in 2014."

McNutt further stated that "A 1985 state attorney general's opinion addressed the question of a former state senator being appointed to the Oklahoma Tax Commission."

In years past, the hiring of ex-legislators has been the cause of some controversy, due wording in Article V, Section 23 of the state constitution.