Rep. Josh Cockroft
"An Open Letter to the Citizens of the State of Oklahoma,
The Oklahoma Supreme Court recently heard oral arguments in a lawsuit brought against Senate Bill 1246, which was passed by the Oklahoma Legislature and signed into law by Governor Mary Fallin in the 2014 legislative session.
That piece of legislation, now state law, was intended to reduce Oklahoma’s personal income tax rate if certain state tax collection targets are met. The lawsuit against the new statute is being aided by vocal opponents of income tax reductions.
According to those who filed the lawsuit, the new law violates provisions of State Question 640, originally approved by a majority of Oklahoma voters in 1992 with the goal of making it more difficult for state lawmakers to increase taxes paid by Oklahomans.
In 1992, state lawmakers’ ability to increase taxes and revenue needed to be restrained. The subsequent constitutional restraint requires that bills creating or increasing taxes, or making new revenue sources for the purpose of funding government, start in the state House of Representatives. Also, such bills cannot be passed in the final five days of the legislative session. As well, they must either be submitted to a vote of the people or receive three-fourths approval by both the state Senate and House of Representatives.
The lawsuit against the new tax reduction attempts to make the case that any bill related to taxes or revenue, whether it increases or decreases taxes paid by Oklahomans, is subject to the provisions of SQ 640. This interpretation violates the plain wording of the amendment and the intent of the voters.
Taxpaying Oklahomans should be alarmed by arguments made last month before the state Supreme Court justices regarding the intent of SQ 640. It was argued before the Court that, when the citizens voted in 1992 to make it more difficult for the state Legislature to increase their taxes, it was actually the intent of voters to make it more difficult to lower their taxes. Such an interpretation would mean SQ 640 applies to any bill dealing with revenue. This is a direct violation of the plain language of the statute in question and the clear intent of the voters. If a subsequent ruling by the Court reflects such rationale, this will have grave consequences on the ability of the Legislature in the future to provide relief to taxpayers.
If the state Supreme Court rules according to the lawsuit’s interpretation, there could be serious consequences. Minor or technical amendments to revenue-related statutes, bills lowering fees, and prior personal income tax cuts, business tax cuts, estate tax cuts, credits and deductions for seniors, and retiree and veteran tax relief could all be challenged and overturned.
It is even possible that dozens, if not hundreds, of past measures enacting tax relief or the expenditure of revenue could be immediately ruled null and void.
Such a ruling sets a precedent benefiting only those who want to undo such prior tax relief as the gross production tax compromise, also passed during the 2014 legislative session.
As well, any law passed in Oklahoma since 1992 that increased or decreased the amount of funds in the state Treasury could be immediately deemed unconstitutional if it failed to meet the standards of SQ 640. This could include state budget bills, which are routinely passed in the final days of session, jeopardizing funding for schools, public safety, transportation infrastructure and safety net services.
Tax-relief measures enacted in Oklahoma since SQ 640’s passage in 1992 that could potentially be ruled unconstitutional, should SB 1246 be struck down by the Court, would include:
- Reductions of the state’s personal income tax rate from 6.65 percent down to 5.25 percent; passed in 2005 and 2006.
- Manufacturing exemption against the state’s corporate income tax for distributors; passed in 2005.
- Prohibition of taxation on intangible personal property; sent to the voters for approval in 2012.
- Setting of the state’s gross production tax rate at 2 percent for all new oil and natural gas wells drilled in the state, for the first three years of a well’s production; passed in 2014.
- Repeal of Oklahoma’s estate tax; passed in 2005.
- Tax relief for all disabled military veterans filing personal income tax returns in Oklahoma; passed in 2005.
- Tying of the state’s standard deduction for taxpaying families to match the federal standard deduction; passed in 2006.
- Tax relief for all private-sector retirees filing personal income tax returns in Oklahoma; passed in 2006.
- Tax relief for all military veterans filing personal income tax returns in Oklahoma; passed in 2006.
Clearly, this was not the intent of Oklahoma voters when they approved SQ 640 in 1992. Such actions by the state Supreme Court would inflict unnecessary hardship on Oklahoma families, retirees, veterans, entrepreneurs and job-creators.
It is our sincere hope that the Oklahoma Supreme Court will use discretion and sound judgment and not rule in such fashion as to throw out two decades-worth of tax reductions for Oklahoma taxpayers. It is truly bizarre to imagine that Oklahoma voters desired in 1992 to make it more difficult than it had previously been for state lawmakers to take less of their money.
Since 1992, Oklahomans have benefited from numerous state-level tax reductions and suffered few state-level tax increases. SQ 640 has been a good protection against rapid escalation of state-level tax rates and unnecessary growth of state government. Our state and its people have benefited as a result.
Rep. Josh Cockroft"
Friday, November 21, 2014
Tuesday, November 11, 2014
In the news this past week was the headline stating the Regents for Oklahoma High Education have requested an additional $98.7 million in state appropriations for the next fiscal year. While their claim is the additional money is for necessary increases, I wonder if their request shows a lack of recognition of the priorities of our state budget and Oklahoma’s conservative majority.
Chancellor Glen Johnson cited Gov. Mary Fallin’s Complete College America Initiative as a justification of the large request. The goal of that initiative is to increase the number of career credentials and college degrees earned by 1,700 each year for 12 years. In the first year of the initiative, the goal was surpassed with an increase of 2,945 additional career credentials and college degrees. In the second year, there were 3,577 additional credentials and degrees. Of the $98.7 million increase, $88.3 million would be used in support of the initiative. Johnson also notes that the increase would bring funding back to pre-recession levels.
The request makes it very clear that Johnson and the Regents of Higher Education do not understand conservative governing principles. Higher education received cuts or flat budgets in past years, because it was flush with funding. The success of the initiative so far shows that they are neither underfunded nor in crisis. If this request is to be honored it would place overall funding for higher education in Oklahoma over $1.086 Billion. Meanwhile, state prisons and K-12 schools, which both rank higher on my priority list, do not have adequate funding or flexibility in their spending. Higher education has long been the sacred cow of state government. Past state legislatures poured money into it with very few tough questions or analysis of the results of that funding. We can not continue to blindly fund such a large portion of our budget. We must continue looking at our state budget in the same way we as families look at our household budgets. Responsibly.
When we get to work in the coming year on the Fiscal Year 2016 budget, I will be among those encouraging lawmakers to focus on common education, career technology schools and other critical needs in Oklahoma. I am no enemy of higher education and I certainly see the positives that our higher education system produces, but I also believe in living within the means. When so many other areas of our state budget are short and stretched thin I think a massive increase to an agency that is flush with funding would be irresponsible and foolish.
Tuesday, November 4, 2014
Elections are always a good indicator of how tuned in the people around you are to politics. There are always people who know a lot about what’s going on in the world and those who know less. Year after year though, it is very clear that almost no one knows much about their judges and justices. The most common question I am asked during each election season is my thoughts on the retention ballots. Many people become frustrated with the lack of information on the judicial candidates, which stems from an effort to keep the judicial system non-partisan. For these reason, many of my colleagues and I have discussed measures to increase judicial accountability. For me, there is no clear path to take with this topic, but it is worth discussing and looking into. Infusing transparency and openness into state government is always a worthwhile endeavor.
Senate Joint Resolution 21, a piece of legislation that failed to garner the necessary votes last year, would have introduced a reform to the state’s Judicial Nominating Commission. This 15-member commission nominates candidates to fill vacant judgeships across Oklahoma. The Governor then chooses judges from among their nominees. Six members of the commission are always attorneys and the rest are always non-lawyers. Currently, the six attorneys are elected to seats on the commission by members of the Oklahoma Bar Association. SJR 21 would have allowed the Speaker of the Oklahoma House of Representatives to appoint three of the attorneys and the Senate President Pro Tempore to appoint three members.
Opponents of the reform have criticized it as a partisan move similar to gerrymandering, basically that Republicans want to further increase their power by having a stronger hand in the nominating process. The simple truth though is that any change to election law is going to look like the majority party is making a power play no matter if it is by the Democrats or Republicans. Instead of responding to such cynical criticism, I am going to simply state the facts. The courts have made questionable judgements on legislation that would have a positive impact for most Oklahomans, but a negative impact on lawyers. The Oklahoma Bar Association’s strong part in the current process gives them a lot of impact on affecting those court decisions. Placing that power instead in the hands of elected officials, returns some of that power to the people.
Other reforms we have discussed include a constitutional amendment that would allow the governor, with the advice and consent of the Senate, to appoint the Supreme Court of Oklahoma’s chief justice. Another constitutional amendment would place 20-year term limits on state justices and appeals court judges. Yet another constitutional amendment would place an age limit on Oklahoma’s Supreme Court Judges. All of these measures would go to a vote of the people.
Oklahoma has a history of tinkering with its government system, a lot of which has led to improved accountability. Corruption has always been a problem in our state, so the people have time and time again tried to limit it with thoughtful reforms. These reforms are no different and I plan to continue to look into them in the upcoming session.