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In The Know is a daily synopsis of Oklahoma policy-related news and blogs. Inclusion of a story does not necessarily mean endorsement by the Oklahoma Policy Institute. You can sign up here to receive In The Know by e-mail.
Today you should know that the chairman of the Senate Finance Committee stalled a leadership-backed proposal to cut Oklahoma’s income tax, after a House committee killed the Senate’s preferred tax cut plan. A plan to eliminate the state’s franchise tax is quickly moving through the Oklahoma Legislature. The Oklahoma Gazette writes that even as Oklahoma’s haves and have-nots grow further apart, some Oklahoma leaders have wanted to make the state’s already-regressive tax code even more so.
A consultant hired by Oklahoma to look at new ways to provide health-care coverage to low-income people ineligible for Medicaid is studying an Arkansas plan that would channel federal Medicaid expansion money through private insurers. The OU Daily writes that Gov. Mary Fallin’s emails released following an Open Records request show that she put politics before Oklahomans’ health. The Tulsa World discussed the Governor’s clashes with the media over holding back some records using privileges that don’t exist in state law.
A House committee advanced a bill that makes unauthorized sharing of food stamps a felony punishable by two years of prison time. OK Policy has been tracking numerous bills this session that threaten the safety net for Oklahomans in need. The OK Policy Blog examines how distributing tax refunds with prepaid debit cards may be saving the state money by pushing fees onto low-income Oklahomans.
Unable to find a replacement CEO after searching since January, Chesapeake’s directors said they would establish a 3-person “office of the chairman” to oversee the company. The U.S. Department of the Interior has fined Chesapeake $765,000 for underpaying oil and natural gas royalties on federal lands. Chesapeake is selling 176 producing wells and oil reserves in Kingfisher and Canadian counties to Gaster Exploration Ltd. Oklahoma Gas and Electric Co. is facing a possible federal lawsuit and civil fines over a failure to monitor emissions after upgrades to two Oklahoma coal plants.
The Number of the Day is the percentage of Oklahoma’s roads that rate “as critical or inadequate” in terms of safety. In today’s Policy Note, the New York Times reports that even though investment in the early education of disadvantaged children has been shown to pay extremely high returns down the road, government spending on the very young is much lower in the United States than in most industrialized nations.
In The News
Leadership bill to cut Oklahoma income tax stalls
The chairman of the Senate Finance Committee on Tuesday stalled a leadership-backed proposal to cut Oklahoma’s income tax, but later said he expected to bring the bill back up for a hearing before a Thursday deadline. The decision by Sen. Mike Mazzei to not hear the bill in his committee came one day after a separate income tax proposal Mazzei sponsored was soundly rejected by a House panel. Thursday is the deadline for the bill to receive a hearing in a Senate committee before proceeding to the full Senate. “We’ve been trying to have a caucus this week with our Senate Republican colleagues to talk about tax cuts and tax proposals and haven’t been able to do that yet, and so that’s why I said (the bill was) laid over for today,” said Mazzei, R-Tulsa. “We’ll discuss everything with our team, and we’ve got two days left to have another Finance Committee meeting.”
Read more from the Enid News & Eagle.
Okla. House panel to consider axing franchise tax
A plan to eliminate the state’s franchise tax is quickly moving through the Oklahoma Legislature. The franchise tax is levied on all corporations that do business in the state in the amount of $1.25 for each $1,000 of capital invested or used in Oklahoma. Foreign corporations are assessed an additional $100 per year. It has been suspended in Oklahoma since 2010 but is scheduled to resume on July 1. A House estimate found that the franchise tax was expected to generate $40 million in the upcoming fiscal year.
Oklahoma’s haves and have-nots grow further apart
Hundreds of thousands of middle- and lower-income Oklahomans this tax season will claim credits that the state Legislature considered eliminating only last year. With 17 percent of Oklahoma City’s residents living below the poverty level of $15,510 for a family of two, losing the Earned Income Tax Credit, the Sales Tax Relief Credit and Child Tax Credit would impact a significant portion of the metro’s most vulnerable families. Despite rising income inequality in the U.S. — a growing gap spotlighted by last year’s presidential campaign and the Occupy Wall Street movement — some Oklahoma leaders have wanted to make the state’s already-regressive tax code even more so.
Read more from the Oklahoma Gazette.
See also: Inequality is bad for business from the OK Policy Blog
Arkansas health-care plan being studied by consultant for Oklahoma
A consultant hired by Oklahoma to look at new ways to provide health-care coverage to low-income people ineligible for Medicaid is studying an Arkansas plan that would channel federal Medicaid money through private insurers. Leavitt Partners, a Utah consulting firm, is examining whether the plan proposed in Arkansas could be applied in some way in Oklahoma, State Commissioner of Health Terry Cline said. An Oklahoma Hospital Association official also confirmed Leavitt’s interest to Oklahoma Watch. Whether Oklahoma will actually pursue such a path remains to be seen. If not, it’s unclear how or whether Oklahoma will find a way to provide health coverage for about 200,000 people who could remain uninsured next year because of Gov. Mary Fallin’s decision not to accept federal funds to expand Medicaid under the Affordable Care Act.
Read more from Oklahoma Watch.
OU Daily: Gov. Mary Fallin’s emails show she put politics before Oklahomans’ health
Late last year, Gov. Mary Fallin rejected $54 million in federal funding to create a health care exchange and declined on behalf of the state of Oklahoma to expand Medicaid coverage to people who hover just above the poverty line but cannot afford private insurance, in direct opposition to the Affordable Care Act. Last week, Fallin responded to an Open Records request by releasing about 50,000 pages of emails and other documents related to the health care exchange and its funding. Piece by piece they depict the scope of the GOP’s team effort to oppose the Affordable Care Act and the amount of pressure that can be exerted on a politician by such an effort. In the end, it appears that the federal funds were declined because they are part of the Affordable Care Act, and it’s more important to Fallin to appear opposed to the president than to concern herself with the health care needs of the people of Oklahoma.
Fallin clashes again with media over records request
Being governor of Oklahoma has its privileges, which is the case in every other state as well. But apparently the Oklahoma governor has a few more privileges than most governors have. At least, that seems to be Gov. Mary Fallin’s view. For example, when reporters demand public records under the state Open Records Act, Fallin can release the ones she feels comfortable releasing, and then claim she has “executive privilege” or “deliberative process privilege” or some other such privilege to keep other records from public view. Now, some open-records experts say such privileges don’t exist, and being experts, there’s a good chance they know what they’re talking about. But even if they are right, all Fallin has to do is hunker down and keep saying she does have such privileges and take her chances with a lawsuit. So much for what was supposed to be one of the most transparent administrations in Oklahoma history.
Read more from the Tulsa World.
Okla. panel approves food stamp restrictions
An Oklahoma House committee advanced a bill Monday to fix what its author says is a legal quirk that allows some people to keep collecting food stamp benefits even after being convicted of food stamp fraud. The Human Services Committee approved it with a 6-3 vote Monday; all three Democrats on the panel voted no. The bill has already passed the Senate and now goes to the full House for consideration. The proposal, introduced by Oklahoma City Sen. David Holt, a Republican, explicitly states that unauthorized sharing of food stamps in the Supplemental Nutrition Assistance Program is fraud and potentially a felony punishable by two years of prison time.
Read more from the Associated Press.
See also: Threats to the Safety Net: Bills affecting low-income Oklahomans from the Oklahoma Policy Institute
Expensive to be poor: Are we saving the state money by pushing fees onto low-income Oklahomans?
A wide-ranging government modernization bill passed in 2011 required all funds disbursed from the State Treasury be sent electronically. A major effect of this provision is that the Oklahoma Tax Commission will no longer send paper checks for tax refunds. Oklahomans who did not set up a direct deposit for their refunds instead received a pre-paid MasterCard debit card. The switch was made to save money for state agencies, but critics pointed out that these savings could come at the expense of Oklahomans who would have to pay new fees to access their money.
Read more from the OK Policy Blog.
Unable to find a CEO, Chesapeake resorts to stop-gap leadership move
When a company issues a release at 4:55 p.m. on Good Friday, it’s not good news. That’s the timing Chesapeake Energy chose to tell investors it hasn’t found the chief executive for which it’s been searching since January. The board, concerned about ongoing financial controversies at the Oklahoma City-based company, forced co-founder Aubrey McClendon to give up his chairmanship last year. Three months ago, it pushed him out completely. His last day was Monday. Unable to find a replacement to run the country’s second-largest natural gas producer after Exxon Mobil Corp., Chesapeake’s directors said they would establish an “office of the chairman,” comprising non-executive Chairman Archie Dunham, chief financial officer Domenic Dell’Osso and acting chief executive Steven Dixon.
Read more from the Houston Chronicle.
Chesapeake fined $765,000 for inaccurate royalty reports
The U.S. Department of the Interior said Tuesday it has fined Chesapeake Energy Corp. $765,000 for underpaying oil and natural gas royalties on federal lands. Chesapeake denied the claims and said it will request a hearing on the matter. The Interior Department’s Office of Natural Resource Revenue said it found the error during an audit that began in 2009. The government said it notified Chesapeake of the error, but that the company “failed to comply at that time.” The government said Chesapeake made the corrections through April 2011, but that in May 2011 it “resumed its practice of submitting inaccurate royalty reports.”
Gastar Exploration buys Chesapeake acreage in central Oklahoma
Gastar Exploration Ltd. is buying proven reserves and undeveloped leasehold interests in Oklahoma from Chesapeake Energy Corp. for $75.2 million. The oil and natural gas company also agreed to repurchase Chesapeake’s shares of its stock for $9.8 million and to settle all litigation between the companies. Gastar shares rose more than 11 percent in premarket trading Monday. Gastar said that the acquisition includes 176 producing wells with an estimated present value of proved reserves of $32.4 million. The proven reserves and undeveloped leasehold interests are in Kingfisher and Canadian counties in Oklahoma.
Read more from the Tulsa World.
Oklahoma Gas and Electric Co could face lawsuit, fines over repairs at two Oklahoma coal plants
Oklahoma Gas and Electric Co. is facing a possible federal lawsuit and civil fines over a series of upgrades to two Oklahoma coal plants in the past 20 years. The U.S. Department of Justice sent a letter in March to OG&E’s attorneys offering to have settlement discussions over a notice of violation the Environmental Protection Agency issued to the utility in April 2011. The EPA notice alleges OG&E didn’t take out the proper permits and failed to monitor emissions for 13 upgrades and repairs to coal units at its Sooner and Muskogee power plants from 1993 to 2006. In its March 7 letter, the Justice Department said it was prepared to file a lawsuit in the case.
Quote of the Day
I wish our officials would properly fund our state and stop this myopic focus on income taxes. We can buy our own coffee. The state can keep the 15 cents and put all those nickels and dimes together and fix real problems.
–Oklahoma City resident Paul Woolsey, in a NewsOK letter to the editor
Number of the Day
31 percent
Percentage of Oklahoma’s roads that rate “as critical or inadequate” in terms of safety, 2013
Source: American Society of Civil Engineers
See previous Numbers of the Day here.
Policy Note
Want education dollars to make a difference? Invest early
James Heckman is one of the nation’s top economists studying human development. Thirteen years ago, he shared the Nobel for economics. In February, he stood before the annual meeting of the Nebraska Chamber of Commerce and Industry, showed the assembled business executives a chart, and demolished the United States’ entire approach to education. The chart showed the results of cognitive tests that were first performed in the 1980s on several hundred low-birthweight 3-year-olds, who were then retested at ages 5, 8 and 18. Children of mothers who had graduated from college scored much higher at age 3 than those whose mothers had dropped out of high school, proof of the advantage for young children of living in rich, stimulating environments. More surprising is that the difference in cognitive performance was just as big at age 18 as it had been at age 3.
Read more from the New York Times.
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Great website, continue the good work!