Conversation sprouts idea; group forms to help state
Step Up Oklahoma’s plan would end gridlock, provide raises for teachers
Six weeks ago, Step Up Oklahoma didn’t exist and wasn’t a thought on anybody’s mind.
My, how things have changed.
The nonpartisan, grassroots coalition of Oklahoma civic and business leaders burst on the Oklahoma political scene on Thursday. That’s when coalition members called a news conference to announce they had come up with a detailed plan to solve the state’s budget impasse, provide a $5,000 pay raise for teachers and restructure state and county government to improve accountability.
What the Oklahoma Legislature ultimately does with the plan remains to be seen, but all the proposals deal with divisive issues that have defied legislative solutions for years.
The names of coalition members, alone, were enough to attract the public’s attention. People such as Harold Hamm, chief executive officer of Continental Resources; Larry Nichols, founder and chairman emeritus of Devon Energy Corp.; Clay Bennett, a member of the ownership group for the Oklahoma City Thunder; and David Rainbolt, executive chairman of BancFirst Corp.
Particularly surprising, however, was that the coalition’s proposed solution to the state’s budget gridlock contained elements that individual members of the coalition had been fighting against for years.
In the past, the oil industry has lobbied the Legislature hard against raising the state’s gross production tax. But here oil executives were Thursday announcing their support for a plan that included raising the state’s starting gross production tax to 4 percent on all future wells and all existing wells that are currently taxed at 2 percent. Rates would continue to go up to 7 percent after 36 months. The change would cost the industry about $133 million.
The sudden change has left many Oklahomans wondering how this coalition came about and how they arrived at their proposals.
Three coalition members agreed to talk to The Oklahoman on Friday to discuss how the organization came about and how its ideas evolved. Agreeing to talk were Dan Boren, a former Oklahoma Democratic Congressman; Gary Pierson, president and CEO of The Oklahoma Publishing Company; and Glenn Coffee, an Oklahoma City attorney.
Among the more interesting revelations were:
• None of the six dozen or so members of the fastgrowing nonpartisan Step Up Oklahoma coalition apparently had even considered forming such a thing prior to December.
• Parts of the package of proposals that the coalition presented Thursday at its news conference differed markedly from proposals coalition members initially agreed upon. Significant changes were made as a result of 17.5 hours of meetings and negotiations that took place between the three coalition members who spoke with The Oklahoman and leaders of the
House and Senate Republican and Democratic caucuses, as well as representatives of the governor’s office. Those negotiations took place on Dec. 19, 20 and 21. Participants say there was a spirit of statesmanship and cooperation, but tensions rose as deadlines for Christmas travel drew near.
The whole coalition thing got started at 12:45 p.m. Dec. 4 when two men who later would go on to become coalition members were sitting in an office, discussing a business deal, said Gary Pierson, president and CEO of The Oklahoma Publishing Company.
While they were talking, a third person they both knew happened to call in and a conversation ensued on a speakerphone.
“I don’t want to get into names, because that’s not what’s important,” Pierson said.
What is important is that this conversation, like many other conversations that have taken place in Oklahoma recently, quickly turned to the state’s budget impasse, the Legislature’s continual struggle to come up with a way to fund teacher pay raises and myriad problems that have stymied state growth.
“What are we going to do with this state?” Pierson recalled the three individuals asking themselves. “What can we do to give our children and grandchildren a reason to live here.”
Pierson said the three decided they needed to be part of the solution, began inviting in others they thought might contribute to a solution and the coalition began growing from there.
“It was very organic, very word of mouth,” Boren said. “People making phone calls and inviting people in.”
Coffee said members of the coalition represent many diverse industries and businesses, and he thinks that has been one of its greatest strengths.
“I think it allowed this group to say, ‘There needs to be a shared sacrifice across the board here,’” he said. “I think the collaborative process really did make a stronger product.”
“There was never an attempt to exclude anybody,” Pierson said, adding that he, personally, invited individuals who worked with the wind industry in their counties to bring them into the discussions. Pierson said he wanted to dispel talk that they weren’t invited. Boren and Coffee confirmed that was the case.
Coalition members didn’t agree on all things, but all were interested in improving the state and ultimately came up with list of proposals that they would all be willing to support if accepted as a package.
Arrangements were then made for Boren, Coffee and Pierson to meet with representatives of the governor’s office and legislative leaders of both the Senate and House.
Boren said the negotiations with lawmakers seemed very productive with individuals from both parties showing a willingness to work together to try to come up with solutions.
“I think there was a recognition from everyone that this problem is too serious and too big to be a parochial issue,” Boren said.
There was give and take. The coalition went into the sessions with lawmakers with a commitment from its oil and gas members that they would support an increase to a 4 percent gross production tax on new wells only, Pierson said. After some tough negotiating, they agreed to include existing wells in the tax increase, he said.
The coalition initially wanted to raise an additional $20 million through taxes on the wind industry, but agreed to lower the request to $15 million during legislative negotiations.
Coalition members also initially proposed raising the top individual income tax rate from 5 to 5.25 percent to help spread the tax burden, but lawmakers said that would require a 75 percent vote. They persuaded coalition members to support making certain changes in personal income tax laws that would raise about the same amount of money.
The changes include such things as lowering the standard deduction, capping itemized deductions at $22,500 (not counting charitable deductions), adding two tax brackets below the 5 percent rate and removing certain loopholes and deductions.
Tables presented to coalition members indicated the changes would be progressive, Pierson said.
• People earning less than $12,000 would end up paying either the same or less than they are paying now each year.
• People earning $12,000 to $26,000 would end up paying $4 to $32 more.
• People earning $26,000 to $50,000 would end up paying $40 to $48 more.
• People earning $50,000 to $150,000 would end up paying $85 to $97 more.
• People earning $150,000 to $1 million would end up paying $135 to $1,049 more.
• People earning $1 million-plus would on average end up paying $2,398 more, the tables show.
Boren, Coffee and Pierson said lawmakers agreed to present the proposals to their caucuses “with vigor and good faith.”
Pierson said people dropped their partisan positions for the most part.
Some of those caucus meetings took place last week and others will take place this coming week, they said.
Step Up Oklahoma members said there is an open invitation for others to join their coalition and they would encourage others to discuss their ideas with lawmakers.
“Succeed or not, this is important dialogue for Oklahoma,” Pierson said.
Gary Pierson, left, and Glenn Coffee meet Friday in downtown Oklahoma City.
Former U.S. Rep. Dan Boren