A southern Oklahoma legislator believes one of the first things the legislature will do when it returns for the 2018 regular legislative session in a few weeks is to work on raising the gross production tax on oil and gas.
It’s what Rep. Pat Ownbey (R-Ardmore) told the Daily Ardmoreite, explaining how the legislature wants to raise the current rate from 2 percent to 4 percent on horizontal wells during their first 36 months of production. After 36 months, the rate would return to a full 7 percent.
“In my view we could even go further, but it’s a good step,” Ownbey said. “There’s some 5 billion dollars worth of new drilling in our state. Of the oil producing states, we’re still the cheapest by far when it comes to gross production tax. That’s money and minerals we have in the ground. I don’t think we need to overcharge, but I think we need to be smart.“
He told the newspaper it has been a “sticky” issue for the past three years.
“There’s a coalition we’re working with right now, that if we get an agreement — it will involve oil and wind and some of these other issues that have been holding us up — where everybody is at the table, to say ‘what can we do to right this issue? Because we’re all part of the state of Oklahoma.’ To me that’s the best-case scenario,” Ownbey said.
Ownbey said updating the gross production tax won’t single-handedly fix the state’s ongoing issues with the budget deficit, but it would be a good start. Adding that if the state could secure funding, then much needed improvements for infrastructure could be made.
“If you want good roads and bridges, we’re going to have to fund them,” Ownbey said. “I think we have the ability to do that with very minimal impact.“
The District 48 Representative is in his last year in the legislature and said it’s his hope the legislative agenda will be simple—to get the state budget back to where it needs to be.
“For me, the issue is to put Oklahoma on the right path when it comes to the budget,” Ownbey said. “If we can get that done then we’ll be light-years ahead, or really, back to where we should be.“