Gov. signs $698M rebate bill as some lawmakers question how this impacts tax cut bills
The push to lure a giant company to Oklahoma has the signature of approval.
On Monday, Governor Stitt signed HB4455, an almost $700 million rebate package that supporters say will spark economic activity in our state.
Many lawmakers say this unique approach is leading the way for future development by showing big companies that Oklahoma is open for business.
But with an expensive price tag attached and negotiations underway to approve the budget, will this take away from legislation to cut taxes or provide tax relief for Oklahomans?
Senator Roger Thompson, (R)-Okemah, is the Chair of the Senate Appropriations Committee, vetting all bills that could impact the state's budget.
As for front loading funds for a large company to move here, he's on board.
“If a company comes, and in this instance invests 3.6 billion dollars, they build 4,000 jobs, we give rebates," Sen. Thompson said. "And they’re markers, so they have a 20% of their cap x to begin with, create 500 jobs, and then we give them a rebate. And then of course we go to 1500 jobs, 2500 jobs, 4,000 jobs. They get a rebate.”
Some lawmakers across the aisle, such as Senator Julia Kirt, (D)-OKC, aren't as convinced.
“My concern is priorities. Why are we making that our first priority of the year, when we’re looking at all the education needs, all the health needs?" Sen. Kirt said. "I’m concerned about spending our surplus that way.”
$698 million is a large chunk of change. While spending money to make money could bring jobs to Oklahoma, it could also have a domino effect on savings.
“It will impact us," Sen. Thompson said. "It will take some of our cash flow away that we now have obligated. Not necessarily encumbered, but obligated.”
Some of the other deals on the table include personal income tax cuts, corporate income tax cuts, changes with the car sales tax and eliminating the 4.5% grocery tax.
“I did support the grocery tax cut, because if you’re talking about priorities, I would much rather be cutting the grocery tax than the franchise tax that comes from only our biggest corporations in this state," Sen. Kirt said.
With a tax rebate now law, the focus turns to those tax cuts. But that might be an uphill battle.
“As far as advancing any tax cuts, it’s not at the top of our priority list," Sen. Thompson said.
Budget negotiations are largely done in secret.
Senator Kirt said of the around $600 million in tax cuts passed in Appropriations last week, many lawmakers won't know what the priority will be until the final budget deal is announced.
For more local news delivered straight to your inbox sign up for our daily newsletter by clicking here.