Con­ver­sa­tion sprouts idea; group forms to help state

Step Up Ok­la­homa’s plan would end grid­lock, pro­vide raises for teach­ers

The Oklahoman (Sunday) - - FRONT PAGE - BY RANDY EL­LIS Staff Writer rel­lis@ok­la­homan.com

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.

Coali­tion be­gins

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.

On av­er­age:

• 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.

[PHOTO BY JIM BECKEL, THE OK­LA­HOMAN]

Gary Pierson, left, and Glenn Cof­fee meet Fri­day in down­town Ok­la­homa City.

Former U.S. Rep. Dan Boren

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