What Do The Oklahoma Tax Commission (OTC) Rules Say About The Oklahoma Parental Choice Tax Credit?

The Oklahoma Parental Choice Tax Credit Act (OPCTCA) – HB1934 – directed the OTC to create/promulgate rules “to implement the provisions of the [Act]” (page 6 and page 8). To that end, the OTC has created rules and now has them open for public comment until 4:30pm on Thursday, October 12th of this year. The rules can be found here. The Oklahoma Statutes created from HB1934 can be found here.

Beginning Monday (10/2), I began to compare the rules to the bill. The rules cannot mirror the bill/statute word for word, because the OTC rules will include verbiage specific to the Act’s implementation. After speaking with Representative Sherrie Conley, I did learn, however, that the rules do have to mirror the legislative intent of the Act – the OTC couldn’t add things via the rules process that weren’t already specified by the Act or the intent of the Legislature in creating the Act. Consequently, I confined my review of the rules to that parameter.

Wednesday, October 4th on our ROPE Report LIVE podcast, I explained my findings – but also, the reasons ROPE cannot abide the Act in the first place. You can find a clip of this video on the front page of the website, but the FULL video can be found on YouTube and Rumble. I think it’s worth a watch for the topics covered.

WHAT CONCERNS DID I HAVE WITH THE RULES?

I really didn’t find any place that did not mirror the legislative intent of the Act. In other words, I couldn’t find any law making through the rules. I did, however, take issue with a couple things:

• There are two versions of “Taxpayer” in the rules. One called “Taxpayer” that copies the definition from the Act, and another called “Oklahoma Taxpayer” that defines that OTC verbiage for a tax payer. These two should be combined because it is confusing to have two “Taxpayer” definitions.
• Under the definition of “Eligible Student”, the OTC adds to the Act’s definition by including the words, “and is registered with the Oklahoma Tax Commission”. What? Why would a child under 18 be registered with the Tax Commission? Their taxpayer parents/guardians are registered, not the child. This designation needs to go in my opinion (IMO). I don’t even see how it’s helpful here and it makes me nervous because we ALREADY collect so much data on CHILDREN in Oklahoma.
• Warrant. There are several problems here IMO.
  • The Act’s definition of “Warrant” says, “means an order for payment directing the State Treasurer to disburse funds to a designated payee. A warrant operates like a paper check.” (page 2 near the bottom of the page)
  • 3D (top of page 5), says this, “Payment of the credit shall be made by the Tax Commission with an individual warrant made payable to the taxpayer and mailed to the private school where the eligible student is enrolled or expected to enroll. The taxpayer shall restrictively endorse the warrant to the private shcool for deposit into the account of the school, unless the tuition and fees for the eligible student have already been paid by the taxpayer.”
    • Why would the OTC send a paper check two places? Why does the school get it and the school ALSO get a warrant mailed to them? The taxpayer has to ‘restrictively’ (meaning they can’t endorse it for personal use – but then, how many people are going to have to be hired to check up on this?) endorse the check they receive to the school. Why doesn’t the parent just take the warrant to the school and not have the OTC issue two warrants?
    • This makes no sense IMO. In fact, the only reason I can see this ‘procedure’ being used is to make it seem as though the payment is coming from the family to the private school – which it is not. According to Forbes Oklahoma Income Tax Calculator, a married couple filing jointly have to make $180,000 before their Oklahoma income tax is $7500 (it’s $7,497) – the ‘reimbursement’ provided by the state for each child to go to private school. Therefore, the state pays the tuition to the private school for every child who applies for the ‘credit’ in a family that earns $180,000 or less.
    • This is extremely important because AG Gentner Drummond “is withdrawing a legal opinion that gained national attention for its support of creating religious charter schools” citing that he believes that state money going to private schools is unconstitutional. Not ony that, but there is a lawsuit to stop the publicly-funded Catholic online charter school already proposed.
    • Incidentally, a KOSU poll from last year found that voters oppose public money going to private schools – which is probably why House and Senate leadership (with cover provided by “school choice” groups Americans For Prosperity (AFP), OCPA and American Federation of Children) – lied to legislators and/or twisted arms to get them to agree that the Act was a ‘tax credit’.

Now, I could go more in depth about the OPCTCA here, but I did that in the video – and will continue to do it as time goes on with the vain hope that the people will see the errors in this idiodic scheme and tell the Legislature to do away with it because, in the long run, this WON’T help parents like the Legislature REDUCING OUR TAXES IN THE FIRST PLACE. The idea that the government overtaxes me and then wants to return money to me – most of it that it stole from OTHER PEOPLE to give me (redistribution of wealth) in the first place – is anathema because the government’s ‘gift’ gives it so much more control over me than if the taxes weren’t taken from me (by force) in the first place.

Believe me, as a Christian, I HATE being the one to stand up and say, “You can’t give my taxes to a private school”, but I’m only doing it because I firmly believe that this whole “school chioce” scheme is to make sure that the public money going to private schools will make private schools public so that NO PARENT HAS A CHOICE as to how their child/children is/are educated.

WHAT SHOULD WE DO NOW?

According to the OTC website, “Written comments will be accepted until 4:30 p.m. on October 12, 2023, at the Oklahoma Tax Commission, Oklahoma City, OK 73194, Attn: Lisa Haws, or by email to parentalchoice@tax.ok.gov.”

So, I’m sending an email to Lisa Haws that says,

Dear Ms. Haws,

Please consider the following comments regarding the Oklahoma Parental Choice Tax Credit Act rules:

There are two versions of “Taxpayer” in the rules. One called “Taxpayer” that copies the definition from the Act, and another called “Oklahoma Taxpayer” that defines that OTC verbiage for a tax payer. These two should be combined because it is confusing to have two “Taxpayer” definitions.

Under the definition of “Eligible Student“, the OTC adds to the Act’s definition by including the words, “and is registered with the Oklahoma Tax Commission”. Why would a child under 18 be registered with the Tax Commission? Their taxpayer parents/guardians are registered, not the child. This designation needs to go in my opinion (IMO). The designation of “taxpayer” already covers who pays taxes.

The Act’s definition of “Warrant” says, “means an order for payment directing the State Treasurer to disburse funds to a designated payee. A warrant operates like a paper check.” (page 2 near the bottom of the page)

• 3D (top of page 5), says this, “Payment of the credit shall be made by the Tax Commission with an individual warrant made payable to the taxpayer and mailed to the private school where the eligible student is enrolled or expected to enroll. The taxpayer shall restrictively endorse the warrant to the private shcool for deposit into the account of the school, unless the tuition and fees for the eligible student have already been paid by the taxpayer.”

• Why would the OTC send a paper check two places? Why does the school get it and the school ALSO get a warrant mailed to them? The taxpayer has to ‘restrictively’ (meaning they can’t endorse it for personal use – but then, how many people are going to have to be hired to check up on this?) endorse the check they receive to the school. Why doesn’t the parent just take the warrant to the school and not have the OTC issue two warrants?

• This makes no sense IMO. In fact, the only reason I can see this ‘procedure’ being used is to make it seem as though the payment is coming from the family to the private school – which it is not. According to Forbes Oklahoma Income Tax Calculator, a married couple filing jointly have to make $180,000 before their Oklahoma income tax is $7500 (it’s $7,497) – the ‘reimbursement’ provided by the state for each child to go to private school. Therefore, the state pays the tuition to the private school for every child who applies for the ‘credit’ in a family that earns $180,000 or less.

Thank you so much for your consideration of my comments.

Sincerely,

CLOSING

Please feel free to make any changes to my letter – also, feel free to examine all the information for yourself to see if I missed something or if you don’t particularly agree with my criticisms of the Rules.

Please watch the ROPE Report LIVE video for more information on the OPCTCA.