March 4th to the polls; corporate welfare

| | Comments (4) | TrackBacks (0)

This week in Urban Tulsa Weekly, a preview of Tuesday's Tulsa City Council primary election and a look down the turnpike at Oklahoma City's vote on "MAPS for Millionaires" -- the 15-month, one-cent sales tax to upgrade the five-year-old Ford Center for an NBA team. There's also a brief tribute to the late, longtime District 2 City Councilor Darla Hall, and a plug for Saturday night's Bob Wills' Birthday celebration at Cain's Ballroom.

On the MAPSforMillionaires.org website, there's a scan of a "vote yes" mailer featuring a photo and a quote from former Mayor Kirk Humphreys. He's using religion to sell this NBA tax:

This vote on March 4th is about so much more than one building or one basketball team. It's about doing the right thing for our city -- creating the environment where we can grow together as families. But it's also about having a facility where we can come together as a community, for events like Women of Faith, Promise Keepers and others, and reach people in profound ways to promote our values as a city.

Of course, there's already a facility capable of hosting Women of Faith, Promise Keepers, and even Billy Graham -- the Ford Center. Those events have already been hosted there. It's hard to understand how new locker rooms, NBA team offices, and a separate NBA practice facility miles away will make the arena more conducive to mass Christian conferences and rallies. Shame on Kirk Humphreys.

While Oklahoma City prepares to dole out more corporate welfare, a Tulsa area legislator is trying to curb the practice. UTW's Brian Ervin reports that State Sen. Mike Mazzei, a Republican, wants to sunset the large number of special tax credits which are targeted to favored businesses. The bill, SB 2024, would ensure that the tax credits are scrutinized on a regular basis. Mazzei says combined they amount to $1 billion a year in lost revenue. The state's total budget is only $7 billion. Mazzei notes that all these tax incentives for economic development haven't amounted to much in the way of good jobs for Oklahomans.

The story also reports an example of unintended consequences in tax credits:

Investors managed to discover some loopholes in two tax credit programs, enabling them to fleece the state of Oklahoma for as much as $66 million in 2005, according to estimates by the Oklahoma Tax Commission.

State officials noticed a steep and sudden increase in requests for certain tax credits that year, prompting lawmakers to look into the matter to discover what Gov. Brad Henry later called "an accounting shell game."

The tax credits in question were designed to encourage investment in Oklahoma, but crafty investors discovered they could make instant profits of 100 to 500 percent by claiming the tax credits on borrowed money.

State Treasurer Scott Meacham outlined a scenario to illustrate the problem: investors could put up $10 million of their own money for a project, and then borrow another $115 million. They could then apply for a 30 percent tax credit (if the project is in a rural area, while urban projects' have a 20 percent tax credit) for the $125 million and get $37.5 million from the state: which is a 375 percent profit at taxpayers' expense.

It is and was illegal to use borrowed money to fund business ventures, but the investors were able to get around that law by creating layers of limited liability companies with the same board of directors, so no actual laws were broken, so no one was prosecuted.

Thank you, Sen. Mike Mazzei. Expect to see him take some arrows from those who have been on the corporate welfare dole from years.

0 TrackBacks

Listed below are links to blogs that reference this entry: March 4th to the polls; corporate welfare.

TrackBack URL for this entry: http://www.batesline.com/cgi-bin/mt/mt-tb.cgi/3646

4 Comments

webworm Author Profile Page said:

I grew up in Okie City, and have lived in Tulsa since 1960. There are a couple of things Tulsans must remember when being bombarded by the World with strident comparisons between here and there: never forget that most of the people in the OKC area don't actually live in the city; they live in Edmond, Midwest City, Putnam City, Piedmont, Yukon, Moore, Mustang, etc., etc., etc. The voters who live in the city limits are a different breed of cat, you might say, and are far more likely to vote for higher taxation than their outlying friends. The streets in Edmond are pretty good, while the streets in the City are only slightly better than we suffer here in Tulsa, and this is only one area of comparison; there are many more!

Jan Thomas said:

And now I remember why I was soooo glad that Dr. Coburn stepped up to run for the Senate seat.

Steve Hunt said:

I think Humphries shot himself and his friends in the foot with this one. You can do this silly stuff to a certain extent, but I think this was well over the line. Thanks for the blog! God doesn't need fancy skyboxes and family (read: marketers) fun centers to do what needs to be done.

Steve Hunt said:

ck me out discussing this very matter on the Seattle "dave ross show" today...go to the 2:45 point to get right to it...added some humor for ya


http://icestream.bonnint.net/seattle/kiro/2008/03/03032008141108.mp3

About this Entry

This page contains a single entry by Michael Bates published on February 29, 2008 11:20 PM.

WFB, RIP was the previous entry in this blog.

Neighborhood conservation districts: The Future of Real Estate? is the next entry in this blog.

Find recent content on the main index or look in the archives to find all content.

Contact

Feeds

Subscribe to feed Subscribe to this blog's feed:
Atom
RSS
[What is this?]