POSTED ON JUNE 13, 2007:
Through the Looking Glass, Clearly
Governor signs S.B. 1 despite State Chamber's last-minute rush to thwart passage
The new Transparency Act should enable citizens to "Google the government" by commanding the creation of a searchable website by which all government expenditures can be monitored by the public.
In a legislative session fraught with so much controversy over immigration reform, abortion, taxes, spending and all of the other arenas for the expected political gladiatorial contests, the first bill filed for the session--Senate Bill 1, a.k.a. the "Taxpayer Transparency Act"--was in contrast a model of bi-partisan legislation on which everyone publicly agreed, having sailed through both the House and the Senate with unanimous support as well as being one of Gov. Brad Henry's agenda items for the 2007 session.
Now that the Legislature has adjourned for the year and the dust is settling from the numerous tussles that went on beneath the Capitol dome, some might find it ironic that the first bill filed would suddenly become the last one debated, and for the first time.
"Sometimes in the zeal of passing what is perceived to be good legislation, our legislators get carried away. That seems to be the case with SB 1," wrote State Chamber CEO and President Richard Rush in a letter to the Governor, dated June 1st, in which he urged Henry to veto the bill.
"A bill that on the surface looks as if no one can be against it, does in fact go too far and will have a tremendously negative impact on our state's economy," he warned.
The bill in question, by Sen. Randy Brogdon, R-Owasso, and Rep. Paul Wesselhoft, R-Moore, is modeled after a relatively new federal law authored by Oklahoma's Republican Sen. Tom Coburn and Illinois Democratic Sen. and presidential hopeful Barack Obama: the Federal Funding Accountability and Transparency Act of 2006.
The new law should eventually enable citizens to "Google the government" by mandating the creation of a searchable website by which all government expenditures can be monitored online by the public.
While not a single voice of opposition to the proposal could be heard during the entire session in an otherwise pugnacious Legislature, the State Chamber's head honcho recently took aim at it.
Rush said it will have a chilling effect on investment in the state by shining "unwanted light on those who invest in Oklahoma and will make it much more difficult to attract those investors," said Rush.
The "unwanted light," he said, will expose tax credits awarded by the state, and the recipients thereof, by requiring them to file electronically in order for the Tax Commission to post them on the mandated website.
Rush called tax credits "critically important incentives to attracting investment" into the state.
"Governor, many thousands of Oklahoma taxpayers, both individuals and businesses, take advantage of our tax credits . . . almost every taxpayer in Oklahoma uses a tax credit of some sort," he said. "Are we all going to have to file electronically and have our name reported on this website?"
"The goal of SB 1 is fine. The inclusion of tax credits is a bad idea. Please veto SB 1. Let the Legislature try again next year," Rush concluded.
At the time of Rush's writing, SB 1 was among a stack of bills on Henry's desk, awaiting the Governor's approval or veto.
Until the State Chamber raised its objection, it was assumed by all, including Henry, that it would be signed into law, given its unanimous support and gubernatorial endorsement.
When questioned about his response to Rush's entreaty, Henry's office seemed somewhat coy about the matter, stating simply that he is "concerned about the unintended consequences of the bill."
State Treasurer Scott Meacham, one of Henry's chief financial advisors, told members of the Capitol press corps that he wasn't aware of the language related to tax credits until the bill had already passed the Legislature.
Brogdon's response was to come out swinging.
Upon learning of Rush's appeal to the Governor, he rallied some of his fellow lawmakers and called for a gathering of the press in order to publicly urge Henry to sign the bill into law.
"I'm shocked that the Chamber would sneak in at the 11th hour and try to submarine this legislation," Brogdon said.
"The state provides millions upon millions of dollars in tax credits to businesses every year. Oklahoma citizens have just as much right to know where this money is going as they do to know where expenditures are going for other government programs," he also said.
Rep. Randy Terrill, R-Moore, who chairs the House Revenue and Taxation Subcommittee, also weighed in on the debate.
"The public has an inherent right to know how their money is spent. Good business investments involving tax credits have nothing to fear from public scrutiny and any legitimate investment of public tax dollars should be able to stand on its own merit," he said.
"Generally, the only time people want state spending information shielded from public purview is when they are talking about 'special' deals, such as those now under investigation by the FBI that benefited former state Sen. Gene Stipe and others," Terrill added.
The debate even had contenders weighing in from Washington, D.C. as one of the masterminds behind the recent government transparency fad also issued a statement upon hearing of the scuffle at home.
"Oklahomans should be concerned by attempts to resist transparency and openness in how their tax dollars are spent," said Dr. Coburn. "The only reason to oppose transparency and openness in government would be if you have something to hide."
Brogdon said Rush's warning about the measure compromising individual taxpayers' privacy "is nothing but a ruse" and "has absolutely no truth to it whatsoever."
The senator referenced a section of the bill that reads, "Nothing in this at all shall require the disclosure of information which is required confidential by state or federal law."
Brogdon said Rush's misdirection amounts to "trying to mix public privacy with public welfare and convoluting the two."
SB 1, he said, will not expose public privacy, but will expose only "corporate welfare."
Mike Seney, the State Chamber's vice-president of operations, said it isn't Rush or the Chamber that is convoluting the two interests, but Oklahoma statutes.
State law, he said, doesn't differentiate between the two, but refers simply to "taxpayers."
"Individuals and businesses aren't defined differently in statute," Seney said.
"If this law is dealing with 'taxpayers,' it's got to deal with them the same way across the board," he continued. "There is definitely concern and vagueness about what this bill does."
Seney referenced Brogdon and others' comparisons between the Oklahoma Taxpayer Transparency Act and the federal law upon which it is modeled.
However, he said the two are not identical, which is the cause for the State Chamber's concern.
"The federal law defines who's required to be posted, it's not personalized and it does not cover tax credits," Seney said. "We don't have a problem with transparency, but we have a problem with invading people's privacy."
Also, he said Rush's "11th-hour entrance" came because the language dealing with tax credits wasn't added to the bill until the last few days before the end of session.
Brogdon said the language in question was added at the request of Tony Mastin, director of the Oklahoma Tax Commission, as part of a conference committee report during those last few days.
The lawmaker said he ran the CCR version of the bill by Meacham before its approval was finalized.
"The Governor's reviewed it and is fine with it as it is," said Meacham after reviewing it with Henry, as related by Brogdon.
Within days of Rush's entreaty, Henry signed SB 1 into law, to take effect Nov. 1.
"We did not anticipate that the Governor was going to veto a bill that passed both houses unanimously--we're not that politically naïve," Seney said in response.
"All we were trying to do is raise the issue so the Legislature will make revisions next year," he said.
Henry and Meacham, and even some of the bill's Republican advocates, seem to agree.
Meacham said the Chamber's spokesmen "raise a valid concern" and that the Legislature needs to explore it.
"It is critical that the Legislature acts expeditiously to further explore the impact of this legislation on economic development, as well as any unintended consequences of this legislation, and take action to rectify any unintended consequences," said Henry in a statement when he signed it into law.
Terrill has made a request for an interim study in which Rush and Seney's concerned would be examined for the purpose of "clean up" language to be submitted during next year's session.
Brogdon said his new law specifies that the website be created by Jan. 1, 2008, but doesn't require it to be "fully searchable" until one year later--plenty of time for any potential problems with the legislation to be rectified before anyone's privacy is compromised.
"I think both the Governor and I have been advocates this session for having more openness in government. Overall, I think it's a very positive bill," said Meacham.
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