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Court hears arguments on tax referendum

The Journal Record

June 11, 2018

OKLAHOMA CITY – The Oklahoma Supreme Court had more questions for Oklahoma Taxpayers Unite attorney Barrett Bowers than it did for the attorneys representing two education associations.

The court heard two arguments Monday afternoon regarding House Bill 1010xx, which raised taxes on motor fuels, cigarettes, oil production and gas production to pay for, among other things, teacher pay raises. The first argument was the question of the constitutionality of the referendum filed by Oklahoma Taxpayers Unite, which was protested by the Association of Professional Oklahoma Educators.

The second argument questioned the language in the signature petition. Oklahoma Taxpayers Unite is trying to gather about 42,000 signatures to get a question on the ballot to repeal HB 1010xx. That question was brought to the court by Oklahoma’s Children, Our Future Inc. and several other education support organizations.

Association of Professional Oklahoma Educators attorney Blake Sonne said the referendum should not be allowed because the bill pertains to education revenue. The state constitution does not allow repeal referendums on measures that could affect public health, safety, or peace. Public education funding falls within that need, he said.

But Sonne said 1010xx can’t be looked at in a vacuum. It is the funding mechanism for several other bills, including one for teacher pay raises. The court questioned whether 1010xx was enacted and if the other bills were enacted yet. They have all been signed, but correlating House Bill 1023 would not operate without 1010xx, Sonne said.

Bowers disagreed, and said that the teacher pay raises would still happen.

“We do not believe that 1010xx is necessary for 1023 to go into effect,” he said, adding that excess state collections will be able to support the teacher pay increases.

“Our position is the petitioners get the money regardless,” Bowers said.

Justice Patrick Wyrick reminded the court that it’s not there to decide whether the state has the money to back the teacher pay raises without a funding mechanism. The court ruled against an earlier cigarette tax, which created a funding shortage and sent the Legislature into a special session to come up with the money needed to fill the gap.

But the enactment issue was brought up again because if HB 1023 is effective now the Legislature will have to come up with money to support it should a repeal referendum be successful.

The first argument could be moot if the second argument against the referendum’s language prevails. Attorney Kent Meyers, who represented the education associations, called the referendum flawed and a genuine mess. He said the gist fails in this referendum’s petition because of how it’s written and the petition lacks an exact copy of the bill. The version attached to the petition does not include section numbers.

The referendum references repealing HB 1010xx; yet, it leaves out the little cigar tax and includes a hotel/motel tax. The hotel/motel tax was repealed by the Legislature and Gov. Mary Fallin.

“This is misleading,” Meyers said.

Additionally, the language is backward, he said. If the issue makes it on the ballot, a ‘Yes’ vote would adopt the referendum petition, which would repeal HB 1010xx. State law says it has to be the other way, he said.

“How will protesters advertise?” he said. “Vote yes, or vote yes. The misleading effect of this gist is fatal and it doesn’t have to be.”

He also picked apart the ballot title for being too short. It could have 200 words but has only 92.

Bowers said the lack of section numbers was an error. Chief Justice Douglas Combs said that keeps someone from finding the information they’re seeking in the bill.

“This (referendum), at best, it’s sloppy,” Combs said. “At the worst, it’s intentionally misleading.”

The justices discussed what exact copy means and whether substantive compliance was good enough. Meyers said an exact copy is what needs to be attached to the petition, as seen in other cases.

“There are no cases that I’m aware of that go with substantive compliance,” he said.

Wyrick said the court should weigh the exact copy requirement on a case-by-case basis.

Bowers said after the hearings that they went well but declined to comment further.

Sonne said he thought the Association of Professional Oklahoma Educators presented a good constitutional argument, though he also agreed with the referendum-language questions. He said the association understands the matter could be back in court again if Oklahoma Taxpayers Unite rewrites the referendum to be more compliant.

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