Here are excerpts from recent editorials in Oklahoma newspapers:
The Oklahoman. May 26, 2017.
The oil and gas industry in Oklahoma has been getting knocked around pretty good at the state Capitol. In calling for the industry to pay a higher gross production tax rate, the House Democratic leader, in particular, regularly pilloried oil and gas as “the wealthiest” and “the most powerful” industry “in the history of the world.”
It’s an effort to depict the industry as greedy and uncaring, one that looks out only for itself at all costs. This narrative is a favorite of liberals across the country, many of whom dream of windmills and solar panels supplying all the nation’s energy, and who demonize fossil fuels as “dirty” and the industry as harmful to the environment.
Our sense is that most Oklahomans reject these arguments, and appreciate what the oil and gas industry has meant to this state and what it continues to mean - tens of thousands of good-paying jobs at companies that in fiscal 2015 remitted about $2 billion in tax revenue to the state treasury.
Most Oklahomans also reject progressives’ notion that the industry doesn’t care about the land. No greater example of this exists than the Oklahoma Energy Resources Board’s now 24-year effort to clean up abandoned oil field sites.
These are locations scarred by exploration and development in Oklahoma, which began in the mid-1880s (with the first commercially productive rig drilled in 1897, near Bartlesville). Certainly, none of the oil and gas operators in the state today had any hand in those early practices.
Yet in 1993, oil industry leaders and royalty owners worked with the Legislature to create the OERB (natural gas producers joined not long after). Using funds voluntarily contributed by producers and royalty owners, the OERB has restored about 15,300 orphaned and abandoned well sites.
Producers and royalty owners pay a small percentage assessment on oil and gas sales in the state. This provides a service that costs the landowner nothing, and costs taxpayers nothing.
All but seven of the state’s 77 counties have benefited. Since the program’s inception, the OERB says, it has spent about $100 million on well site cleanup. The number of cleanups ranges from one each in Texas, Johnston and Pushmataha counties, to 2,201 in Seminole County and 1,677 in Creek County.
The OERB recently noted it had restored 1,000 sites in Osage County, with about 360 others identified. Estimates are that thousands more may remain in the county, which was a hotbed of the state’s early drilling activity.
The Oklahoman’s Adam Wilmoth recently spoke to landowners James Wright and Vicki Hayward, beneficiaries of the 1,000th cleanup in Osage County. Their 140 acres of land near Sperry included 25 acres littered with concrete remnants of an old oil field, and by an old saltwater dump. They didn’t have the wherewithal to remedy those problems on their own.
“It’s a dream come true,” Hayward said. “It’s beyond our expectations.”
Consider them two more residents who are grateful for the oil and gas industry in Oklahoma.
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Tulsa World. May 26, 2017.
The Oklahoma Legislature has enriched big oil and natural gas producers and gotten very little in exchange for the state.
By the narrowest of margins, the House gave final legislative approval to Senate Bill 867. That opens the way for broader use of so-called long laterals, a petroleum drilling method that uses hundreds of feet of horizontally drilled arteries that can greatly enhance productivity of wells.
It will mean a lot more profitability for some oil companies, the really big ones that can afford the more expensive front-end costs.
We are comfortable with long laterals environmentally and on other levels, but it’s ridiculous that the Legislature signed off on this gift to Big Oil without getting more in return.
Simultaneous with consideration of the long lateral, the Legislature considered raising the effective gross production tax on oil and natural gas wells to 4, 5, or even 7 percent.
Oklahoma’s effective gross production tax rate is the lowest among oil states and for no good reason. A reasonable gross production tax increase would bring in much needed revenue for essential state services without any real impact on the state economy.
But, under heavy and sometimes dishonest lobbying from Big Oil, the Legislature blinked, approving only a modest change in the gross production tax - affecting only 11 percent of the producing wells and only having any impact there for two years.
Essentially, Big Oil got its long laterals for pennies.
SB 867 is a bad deal for our state. Gov. Mary Fallin should veto it and insist on a better gross production tax bargain for Oklahoma.
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Enid News & Eagle. May 27, 2017.
This is the strangest legislative session we can remember.
Last Christmas, we knew a nearly $900 million budget hole was awaiting lawmakers in 2017.
Before the session, most Oklahomans were talking about the importance of teacher raises. Many legislators promised us they would happen.
We needed leadership but didn’t get it. Oklahoma Gov. Mary Fallin’s State of the State proposal to tack on all kinds of service fees was dead on arrival.
The state Legislature has been meeting since February. Legislators had one consensus goal to attain - give teachers raises - and failed with flying colors.
Before the final week of the legislative session, Republicans and Democrats were no closer to reaching a budget compromise after a rare Saturday session. That fruitless session was followed by more inaction.
Then, in the dark of night on a Tuesday, lawmakers in House and Senate committees had about 10 minutes to consider voting on a $6.8 billion budget deal. Giving lawmakers little time to read legislation insults our state’s republican democracy and totally cuts the people out of the process.
State Sen. David Holt, R-Oklahoma City, tweeted that the budget process was the least transparent he had seen during his legislative tenure. Holt was one of five Republicans to oppose the measure in committee.
“This is a real disservice to the people of Oklahoma to do it this way,” Holt told The Associated Press. “This is not the way it should work.”
The theme of this year’s budget vote was “hold your nose.”
The budget didn’t even receive a ringing endorsement from its House author, state Rep. Leslie Osborn, R-Mustang. She called the final product “as good as it’s going to get.”
Fallin issued a statement admitting the budget was not “ideal” and did not fix structural budget challenges.
“Year after year, I have repeated my warning about our reliance on one-time funding and our eroding tax base, and yet again we have crafted a budget that only fixes some of the defects in our funding formula,” Fallin said.
“When legislators return next year, they will already face a $400 million hole caused by one-time funds and $100 million of obligations coming due over the next 12 months that will need to be paid.”
We have serious questions about the fuzzy math and the fact that this budget will create a $400 million deficit for next year.
Legal threats linger. If the revenue votes are deemed unconstitutional - as expected - Fallin said she’ll likely call lawmakers back into special session as early as July.
House Minority Leader Scott Inman, D-Del City, said he’s confident many of the votes “are constitutionally infirm.”
Meanwhile, the Oklahoma Council of Public Affairs intends to challenge the constitutionality of a budget measure capping the amount of itemized deductions at $17,000 per year.
Wow. Democrats agree with a conservative think tank. We are officially in bizarro world.
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