In The Know: Oklahoma House, Senate approve permanent tax break for oil and gas companies

In The KnowIn 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 or subscribe to the podcast on iTunes, Stitcher, or RSS. The podcast theme music is by Zebre.

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Today you should know that a bill giving a permanent tax break for oil and gas drilling (HB 2562)  has passed through the House and the Senate. Under the bill, corporations will pay a 2 percent gross production tax for the first 36 months of production and 7 percent after for both horizontal and vertical wells. Previously, all vertical well had been taxed at 7 percent. Due to a tax break, horizontal wells had previously been taxed at 1 percent for the first 48 months of production. Oklahoma Policy Institute released a statement that the bill extends a huge, unnecessary tax break that is contributing to Oklahoma’s budget crisis.

The House approved a $7.1 billion state budget bill that cuts the budgets of many state agencies by 5.5 percent. The bill now moves to Gov. Fallin. The budget spends down nearly $300 million in reserve funds while still appropriating about $100 million less than 2014. David Blatt’s Journal Record column discussed why the bill fails to meet the state’s critical obligations in a responsible and sustainable way. The Senate also approved a $2.4 billion education budget. Figures recently released from the US Census Bureau show that Oklahoma spent less per student on education in 2012 than all but two other states. 

State Board of Education members criticized the state legislature’s override of Gov. Fallin’s veto of HB 2526, which gives parents and teachers a say in the decision of whether to retain or promote third graders who failed state reading tests. Tulsa Public Schools is instituting summer remedial reading programs for students who failed the test. Their performance in the program will be a factor in the decision to retain or promote them. The Tulsa World noted that the final version of a bill repealing Common Core in Oklahoma has yet to be approved and argued for letting the bill die when the session adjourns.  House legal staff said reports that the bill repealing Common Core would reinstate mandatory third-grade retention are not accurate.

After initially defeating it, the House approved Governor Fallin’s proposal (HJR 1092) to allow school districts to hold local votes extending their bonding capacity for school storm shelters. The House also passed a $120 million Capitol bond issue to renovate the state Capitol building. The House and Senate both passed a bill (HB 3469) requiring DHS employees who receive abuse or neglect complaints to take the issue under special consideration if the alleged victim has complex medical need or disabilities that make it difficult for DHS workers to communicate with the child. On the OK Policy blog, we discussed a report finding that DHS has failed to make “good faith efforts to achieve substantial and sustained progress” in its efforts to reform the child welfare system.  

The US House approved a bill protecting three of seven planes the Air Force wants to retire from Tinker Air Force Base. A bill encouraging water reuse passed the House and Senate, and heads next to the Governor’s desk. State Representative Bobby Cleveland is forming an interim study panel to develop “smart on crime” reforms to Oklahoma’s criminal justice reform. Oklahoma City lawyer Jerry Fent has filed suit alleging that the state’s income tax reduction, which Gov. Fallin signed into law earlier this session, violates the state Constitution. The bridge between Purcell and Lexington, which has been closed for repairs since January, is scheduled to reopen in mid-June. The Oklahoma City Planning Commission has voted to deny a permit for an adult psychiatric center after complaints from nearby residents. Tulsans with disabilities who depend on the city’s transit system filled a hearing room to capacity and asked city officials to not cut route hours as part of city budget cuts.

The parents of students killed when a tornado hit Plaza Towers Elementary School have filed tort claims with the city of Moore and Moore Public Schools, contending that the school did not follow safety protocols and that schools were not built to code. The CEO of Morton Comprehensive Health Services wrote in the Tulsa World that unless the legislature replenishes the uncompensated care fund, Oklahoma’s uninsured will go without needed health care. We’ve written about the importance uncompensated care at Oklahoma’s community health centers before. KGOU reported that Oklahoma’s very poor wheat harvest, which is predicted to be half the normal amount due to drought, will have nationwide repercussions. 

The Number of the Day is the percentage of Oklahoma foster care workers whose caseloads are still much higher than the standard set by the Pinnacle Plan. In today’s Policy Note, Ta-Nehisi Coates explains why it’s important for Americans to more fully acknowledge our country’s history of racism and its impact on the present. 

In The News

Bill Giving Permanent Tax Break to Oil and Gas Companies Clears House, Senate

The Oklahoma Legislature approved a new formula Thursday for taxing oil and gas production, one that will have little immediate impact on state finances but might cause a long-term reduction in revenue collections. Under the new formula, which would apply to all wells drilled after June 30, 2015, oil companies will pay a 2 percent tax during the first 36 months of production and 7 percent thereafter. For the past 43 years, the state’s gross production tax has been fixed at 7 percent for conventional, vertically drilled oil and gas wells. Under a temporary tax break enacted in in 1994 and extended several times, the rate was set at 1 percent for horizontally drilled wells during their first four years of production. Twenty years ago, horizontal drilling was an exotic and expensive new drilling technique, and oil companies said they needed the tax incentive to help them develop it. Today, about 70 percent of all new wells are drilled horizontally, according to the Oklahoma Corporation Commission.

Read more from Oklahoma Watch.

See also: STATEMENT: Vote to make drilling tax break permanent folds to lobbying power, harms OK economy from OK Policy.

Oklahoma House approves $7.1 billion state budget bill

The state House of Representatives on Thursday approved a $7.1 billion state appropriations bill that allocates about $80 million in new revenue for common education and $37.1 million for targeted pay raises to some of the state’s most underpaid state employees. The bill will now go to the governor. Many state agencies will receive 5.5 percent budget reductions, but some agencies came out out much better.

Read more from NewsOK.

Okla. Senate passes $2.4 billion education budget

The Oklahoma Senate has given final approval to a $2.4 billion budget plan for elementary and secondary schools in the state for the upcoming year. The Senate approved the measure 44-0 Thursday and sent it to Gov. Mary Fallin to be signed into law. The budget proposal for the fiscal year that begins July 1 is $80 million more than the education budget for the current year. Local school districts will also receive a $25 million supplemental appropriation for the current year for reimbursement of taxes on property that is exempt from local taxation.

Read more from News9.

Oklahoma public education spending ranks low

Oklahoma spent less per student on public elementary and secondary education in 2012 than all but two states, according to figures released Thursday by the U.S. Census Bureau. Only Utah, with $6,206, and Idaho, with $6,659, spent less in fiscal year 2012 than Oklahoma, with $7,466, data shows. Arizona, with $7,559, and Mississippi, with $8,164, rounded out the bottom five. “There is no doubt that the Great Recession of 2008 hurt education funding in Oklahoma, just as it had an adverse impact on the economy nationwide and globally,” said Phil Bacharach, a spokesman for state schools Superintendent Janet Barresi. “Superintendent Barresi and the state Department of Education have worked hard to make the case for increasing school funding, and the legislature has bolstered K-12 education funding over the past two years.

Read more from NewsOK.

See also: Oklahoma’s per pupil spending has plummeted from the OK Policy blog.

TPS Using Summer To Prepare Third Graders For Next Grade

Oklahoma lawmakers override the Governor’s veto and changes to the third grade reading bill will become law. The House and Senate both voted overwhelmingly to override Governor Fallin’s veto. Schools and parents will now have more of a say if a student should advance to the fourth grade, if they fail the state test. The Governor said we are setting children up to fail. “Nothing changes the fact that we still have 8,000 third graders that can’t read at grade level, that are basically reading at the first grade level as a third grader,” Fallin said. In Tulsa Public Schools alone 33 percent of students did not pass the reading test. That is more than a thousand children.

Read more from NewsOn6.

State board of education slams modifications to 3rd-grade reading law, veto override

The state Board of Education on Thursday blasted the passage of legislation that gives parents and teachers a say-so in the decision about whether to hold back struggling readers as a “true setback” that will restore social promotion in public schools. Also, the board approved State Superintendent Janet Barresi’s plan to use $6.54 million budgeted for a variety of school activities to cover a deficit in state-mandated health insurance premiums for school employees. But comments on House Bill 2625 dominated the shorter-than-average board meeting.

Read more from the Tulsa World.

Common Core repeal bill wouldn’t affect 3rd-grade reading changes, supporters say

What appears to have been a false alarm left some legislators and opponents of Common Core in a temporary quandary on Thursday. Many Common Core foes also supported House Bill 2526, the modifications to the state’s Reading Sufficiency Act passed Wednesday over Gov. Mary Fallin’s veto. Thursday morning, it was pointed out that language in HB 3399, the Common Core repeal bill still awaiting a House vote, appeared to conflict with HB 2526. House legal staff, though, said otherwise, and by late morning anti-Common Core activists were again lobbying for HB 3399. The measure is expected to get a floor vote on Friday. Citing what they say is an opinion by Kim Bishop, legal counsel for the House Common Education Committee, Common Core foes said House Bills 3399 and 2625 do not conflict.

Read more from the Tulsa World.

Still time to save Common Core

Both houses of the Oklahoma Legislature have passed misguided attempts to repeal Common Core education standards, but there still appears to be a chance the right thing will happen anyway. The final version of the bill is yet to be approved, and the Legislature could adjourn as soon as Friday. Common Core standards were adopted in 2010. They would increase classroom rigor and make outcomes comparable across state lines. The standards have strong support from educators and the business community, but they fell victim to false political rhetoric. Zealots claim that Common Core was cooked up by the federal government and is being forced down the throats of local schools. Nothing could be further from the truth. The states developed the standards, and in our discussions with local school officials we have found strong support for the effort.

Read more from the Tulsa World.

Oklahoma House reverses course, approves storm shelter measure

In a dramatic late night flip-flop, members of the state House of Representatives reversed course Thursday and approved a school storm shelter proposal backed by Oklahoma Gov. Mary Fallin just hours after they had defeated it. House members voted 51-39 to approve the resolution after initially voting 34-61 to reject it. In between those two votes, Fallin lobbied House members on the House floor and issued an angry news release blaming the initial defeat of the measure on “a politically motivated and intentionally misleading smear campaign.” “Critics of the bill said House Joint Resolution 1092 would have raised taxes. It does not,” Fallin said in her news release. “It would have allowed local communities to increase their bonding indebtedness only if those communities voted to do so. It is a local control measure that supports decisions made by local communities.”

Read more from NewsOK.

 Okla. House Passes $120 Million Capitol Bond Issue

A $120 million bond issue to repair and renovate Oklahoma’s nearly 100-year-old state Capitol building has been approved by the state House. The House voted 55-34 on Thursday for the bond issue and sent it to the Senate, which is expected to consider the measure Friday. The bill by Republican House Speaker Jeff Hickman of Fairview was a compromise developed by members of the House, where a $160 million, 25-year bond proposal for Capitol repairs was rejected last month. Hickman says the 10-year plan will save between $80 million and $100 million in interest payments over the life of the bond issue.

Read more from News9.

Oklahoma lawmakers pass DHS reform bill

The state Senate and House of Representatives on Thursday easily passed a bill drafted in response to a student with severe disabilities who died after state Department of Human Services workers failed to respond appropriately to repeated allegations of abuse and neglect. The measure now goes to the governor. House Bill 3469 was named the Quinten Douglas Wood Act in honor of a 15-year-old Midwest City student who died Jan. 4, 2013, after state Department of Human Services employees failed to properly investigate calls from his sister, who alleged he was being neglected in his Oklahoma City home.

Read more from NewsOK.

Court-ordered monitors find Oklahoma falling short in efforts to fix foster care system

Almost two years after finalizing an historic plan to transform its child welfare system, a new report finds that the Oklahoma Department of Human Services (DHS) is falling short of making “good faith efforts to achieve substantial and sustained progress” on several key benchmarks. Unfortunately, a growing number of abused and neglected children and the enormity of the challenges facing the system will continue to hinder efforts to ensure the safety of Oklahoma kids. Since 2012, Oklahoma’s child welfare reform effort has been guided by the Pinnacle Plan, which was developed by DHS out of a settlement agreement reached in a federal class action lawsuit. Oklahoma’s foster care system was found deficient for allowing abuse of children in its care, placing children in overcrowded and understaffed emergency shelters, and failing to provide secure and long-term placements, among other concerns.

Read more from the OK Policy blog.

Oklahoma efforts to save AWACS makes progress in House, Senate

Oklahoma lawmakers succeeded on two fronts Thursday to save AWACS planes and a Reserve unit that flies them at Tinker Air Force Base. The full House approved a defense bill that would protect three of the seven planes that the Air Force wants to retire from Tinker. Over in the Senate, Sen. Jim Inhofe said a defense bill he helped write would retain all of the AWACS. “We’re really dealing with a national asset here, both in personnel and in aircraft,’’ Rep. Tom Cole said after the House vote. “Once you lose them, they’re gone.” Cole, R-Moore, represents Tinker and serves on the committee that will now have to come up with the money to protect the AWACS from the Air Force cuts.

Read more from NewsOK.

Bill co-authors from Norman support reuse of critical resource

A bill encouraging and supporting water reuse went to the governor’s desk Thursday, thanks to Norman lawmakers. Authored in the Senate by Rob Standridge, R-Norman, and co-author John Sparks, D-Norman, then carried in the House by Rep. Scott Martin, R-Norman, the measure represents bipartisan effort to respond to emerging water shortages through facilitating reuse policy. “In most cases, water reuse is more affordable than the construction of new pipelines or a reservoir, and the technology has proven to be safe, effective and reliable,” Standridge said. “For a number of growing municipalities, reuse may be the best option to expand the supply of drinking water. This legislation will support and enable water districts and municipalities to move ahead with water reuse projects.”

Read more from the Norman Transcript.

Oklahoma lawmaker: In pursuit of a prison system that works

Living in the Lexington area and having a number of constituents who work for the Oklahoma Department of Corrections, I’m very interested in the state’s prison system. This system needs help. Taxpayers will spend roughly $500 million on it in 2013-14. The cost continues to rise each year. At this rate, we will approach $1 billion in prison expenses if we don’t do something. One thing that’s apparent as I’ve toured prisons across the state is that we have a highly professional staff of correctional employees. Oklahoma corrections officers are nearly the lowest paid in the nation and they’re required to work a minimum of 60 hours per week due to budget cuts and an abundance of inmates.

Read more from The Oklahoman.

Lawsuit alleges income tax reduction measures violates state Constitution

An Oklahoma City attorney who has successfully sued the state before is asking the state Supreme Court to throw out an income tax reduction law on the basis that it violates the state Constitution. Jerry Fent says in the lawsuit filed Thursday that bills affecting state revenue need to originate in the House, and this bill started in the Senate. He also says such bills require a three-fourths vote in the Oklahoma House and Senate, and the approval of this bill did not reach that threshold. ov. Mary Fallin, who is named as defendant in the lawsuit, had no comment. A hearing is scheduled for June 24 before a referee who will recommend whether the state’s highest court should take up the case.

Read more from NewsOK.

Closed Oklahoma bridge expected to reopen next month

Oklahoma transportation officials say a bridge linking two towns that was closed because of cracks should be reopened by June 14. The Oklahoma Department of Transportation announced Thursday that a contractor working to fix the James. C. Nance bridge has completed the initial steps to remove rivets and replace them with bolts. The areas need to be sandblasted and painted before repair places can be installed. The bridge links the communities of Purcell and Lexington. It has been closed since January when initial cracks were found. Transportation officials announced last month that additional cracks were located.

Read more from NewsOK.

Oklahoma City Planning Commission votes to deny permit for adult psychiatric center

The Oklahoma City Planning Commission voted Thursday to recommend denying Cedar Ridge Hospital a permit to house adult psychiatric patients at its northeast Oklahoma City campus after a contentious hearing where residents from the area said they were concerned about runaways from the facility. “This company has a history of noncompliance,” northeast Oklahoma City resident Richard Scroggins said at the hearing. “We need to know in our community that we can trust them, and that has not been proven at this point.” Police logs show that there have been 13 calls for service from Cedar Ridge in the past 12 months to report runaways from the facility. Two of the calls were for adult patients, the remaining 11 calls were to report runaway juvenile patients, records show.

Read more from NewsOK.

Tulsa’s disabled residents plead for council to keep transit hours in budget

A capacity audience told city officials Thursday that budget burdens should not rest on Tulsa Transit, which is a necessity for many disabled people. The City Council is considering a proposed budget that calls for reduced hours on the Metropolitan Tulsa Transit Authority’s fixed route system and Lift program, shortening each by 90 minutes each day. Bill Cartwright, Tulsa Transit general manager, said the cut hours and increased fares are necessary to meet budget requirements as the city faces a $7 million general fund shortfall this year. Cartwright has said the cuts were made to affect the lowest number of transit riders possible. Patti McClure, a retired nurse, said it’s difficult to have spent her career taking care of people and now need people to take care of her. The Lift program is the only reasonable way she’s able to leave her home, she said.

Read more from the Tulsa World.

Parents of Plaza Towers tornado victims seeking damages from Moore, school district

The parents of six children who died inside the wreckage of Plaza Towers Elementary School after the tornado on May 20, 2013, have filed tort claims with the city of Moore and Moore Public Schools. In the documents, the parents claim the school failed to follow safety protocols and the city failed to use qualified architects, engineers and contractors when building the classroom addition where the children died. A tort claim is a legal complaint against a governmental body. It often is a precursor to a lawsuit, but it gives the governmental body a chance to pay damages without going to court.

Read more from NewsOK.

Health-care disparities create perfect storm

Throughout the state, storm clouds gather. The perfect storm is forming and Oklahomans are the architects. Health-care disparities grow in poor urban neighborhoods and rural communities. Oklahomans have watched these events for many years and we remain unmoved, preferring instead to allow others to influence events and establish priorities. We tacitly support continuation and expansion of millions of dollars of corporate tax breaks for our most affluent industry, while silently watching the collapse of our state’s infrastructure. We have signed onto the mantra that corporate tax breaks for our energy industry will somehow improve the quality of our lives, regardless of what our eyes and the facts tell us. On the front lines of health-care delivery, the situation has gone from frustrating to incomprehensible. In partnership with the state over the past decade, community health centers have expanded to 19 organizations and 60 delivery sites throughout Oklahoma. This is a network of medical homes serving more than 160,000 patients including uninsured, poor and rural citizens.

Read more from the Tulsa World.

See also: “I don’t know where we go from here”: Community health centers caught in limbo on the OK Policy blog.

Oklahoma’s Drought-Withered Wheat Harvest Could Have National Effects

Four years of extreme drought has withered the agricultural economies of southern Great Plains states like Oklahoma, where farmers are bracing for one of worst wheat crops in state history. And Oklahoma’s withered wheat harvest could have national consequences. Wayne Schmedt adjusts his faded blue cap and crouches down in a wind-whipped field near Altus in southwest Oklahoma. His brother and business partner, Fred, grins and waits. The jokes start before the dusty rain gauge is pulled from the cracked dirt. “We don’t have any use for this so we’ll give it to you as a souvenir,” Wayne says. Gallows humor is key to surviving as a farmer, especially one in Great Plains states like Oklahoma. Here, summers are hot and dry. Spring rains often drown fields in flash floods. And a late freeze can kill off what’s left. It’s a cruel joke.

Read more from KGOU.

See also: Oklahoma drought and burn ban update from the Tulsa World.

Quote of the Day

“Some lawmakers want to run for other offices outside the Legislature after they leave, and they will do anything to appear tough on crime at the expense of the state. We need legislators who are interested in changing the game, being smart on crime and unafraid of the outdated politician labeling them soft on crime.”

-Rep. Bobby Cleveland, R-Slaughterville, who is forming an interim study to develop “smart on crime” reforms to Oklahoma’s criminal justice system (Source:

Number of the Day


Percentage of Oklahoma foster care workers whose caseloads are still much higher than the standard set by the Pinnacle Plan.

Source: Oklahoma Department of Human Services

See previous Numbers of the Day here.

Policy Note

The Case for Reparations

Clyde Ross was born in 1923, the seventh of 13 children, near Clarksdale, Mississippi, the home of the blues. Ross’s parents owned and farmed a 40-acre tract of land, flush with cows, hogs, and mules. Ross’s mother would drive to Clarksdale to do her shopping in a horse and buggy, in which she invested all the pride one might place in a Cadillac. The family owned another horse, with a red coat, which they gave to Clyde. The Ross family wanted for little, save that which all black families in the Deep South then desperately desired—the protection of the law. In the 1920s, Jim Crow Mississippi was, in all facets of society, a kleptocracy. The majority of the people in the state were perpetually robbed of the vote—a hijacking engineered through the trickery of the poll tax and the muscle of the lynch mob.

Read more from The Atlantic.

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Carly Putnam joined OK Policy in 2013. As Policy Director, she supervises policy research and strategy. She previously worked as an OK Policy intern, and she was OK Policy's health care policy analyst through July 2020. She graduated from the University of Tulsa in 2013. As a student, she was a participant in the National Education for Women (N.E.W.) Leadership Institute and interned with Planned Parenthood. Carly is a graduate of the Oklahoma Center for Nonprofits Nonprofit Management Certification; the Oklahoma Developmental Disabilities Council’s Partners in Policymaking; The Mine, a social entrepreneurship fellowship in Tulsa; and Leadership Tulsa Class 62. She currently serves on the boards of Restore Hope Ministries and The Arc of Oklahoma. In her free time, she enjoys reading, cooking, and doing battle with her hundred year-old house.

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