The Oklahoma Supreme Court heard arguments Thursday in challenges to a proposal to pay teachers more by raising the tax on oil and gas production.
State Question 795 will ask voters to levy a 5 percent gross production tax for 36 months, but the Oklahoma Independent Petroleum Association wants it pulled from the November ballot because the written gist of the initiative is not clear about which wells would be affected.
Attorney Robert McCampbell said it could have been an easy fix for the petition's backers, but now they've raised the potential of an unconstitutional retroactive tax.
"They could add five words: for wells spudded after July 1, 2015," McCampbell said.
Proponents’ attorney Ryan Ray told Justice Patrick Wyrick the intent is clear.
"If this article passes, if [a well] was in [month] 34, yes, your honor, it applies to the two months left in the 36 month period," Ray said.
"So, no retroactive effect," Wyrick said.
"It does not apply retroactively," Ray said.
McCampbell also argued the gist was too supportive of the initiative's goal, a $4,000 raise for teachers.
The Oklahoma Oil and Gas Association has a separate challenge, alleging it amounts to logrolling for instituting a tax, spending it and giving oversight to the Board of Equalization.
Attorney Glenn Coffee compared it to a failed initiative to use a statewide, 1 cent sales tax to fund teacher raises and said he didn't vote for that because it didn't let him choose between the raise he wanted and the tax he didn't.
"In succeeding years, we could very well see a state employee pay raise funded by a tax on wind, funding for mental health by means of a liquor tax, funding for food stamps by means of a professional services sales tax," Coffee said.
Ray said precedent allows "interlocking packages," which is what they have.
"All of the parts are dependent on one another," Ray said. We’re going to raise the money. We’re going to put the money in funds. We’re going to specify what that money can be used for, and we’re going to have an auditing and oversight component."
There is no word on when the Oklahoma Supreme Court might rule.
