A bill to lower ad valorem taxes for broadband service companies in the state was approved Thursday in the Oklahoma Senate, but not before one senator argued, “This is effectively socialism where government takes taxpayer money and redistributes it to industries that they have decided is favorable.”
Tulsa Senator Dave Rader’s SB1122 would lower ad valorem taxes from 23% to 15% for broadband service providers. As the fiscal impact from the State Tax Commission explained, “This represents a decrease from the current assessment ratio applicable to public service corporation property, including broadband providers, which is about 22.85%. Based on public service assessment data for tax year 2025 and assuming application of the proposed 15% assessment ratio to the full asset base of qualifying telecommunications providers, the proposal results in an estimated $20.0 million reduction in local
property tax collections based on recent statewide weighted average millage rates.”
Rader told Senators Thursday, “It’s going to help these companies continue to do business in Oklahoma. And that’s what the bill is doing should be beneficial to the people of Oklahoma should be beneficial to all the taxpayers of this effect because everybody’s need better and clearer Internet because that’s the way we operate now.”
Rader said the companies are willing to do that in Oklahoma and it will “level the playing field.”
Shawnee Sen. Shane Jett had other thoughts.
“Members, this is not capitalism. This is effectively socialism where government takes taxpayer money and redistributes it to industries that they have decided is favorable.”
He called it “this decade’s boondoggle of broadband” and compared it to what he called the Obama administration’s solar panel boondoggle where billions of dollars were squandered and the taxpayer footed the bill.
“This is another boondoggle like wind turbines where businesses are making decisions to align their investment based on the maximum number of taxpayer dollars that they can extract from the federal government and from a generous state legislature like this. The same individuals who are recipients of taxpayer dollars funnel that money right back into the PACs and individual campaign coffers of this building. This is a one billion dollars infusion of taxpayer dollars into the state of Oklahoma.”
Sen. Jett told fellow senators they were not the lobbyists of the broadband companies who have lobbyists at the capitol.
“Their lobbyists write checks to PACs to try to influence this building to shovel yet more money into that industry. 43.5 million dollars. 43.5 million dollars to one western broadband rollout company in southwestern Oklahoma.”
Norman Sen. Mary Boren also challenged Rader about who was benefitting from his bill.
“So isn’t it true then that there will be places where broadband companies are paying a higher rate today and after this bill, in those counties where broadband may have been there for 20, 30 years, they’re going to be paying a lower rate. Is that true?”
Rader: “Thank you for the question. I’m not sure how the economics is going to work out.”
Boren wasn’t finished.
“My question is that as I’ve been researching this bill, my research has indicated to me that there’s only one company out of all the broadband companies in the state of Oklahoma that currently pay that 15 percent. Is that an accurate fact or do I need to be informed differently?
“Rader, “Thank you for the question. I’m not aware of that.”
Some broadband companies, said Rader, are paying the higher rate but if the bill became law, their rates would drop to 15%.
Another critic was Sen. Julie McIntosh who told Rader, “I remain concerned that this is removing money from our counties.”
McIntosh argued that changes in the bill would result in an impact to counties significantly more than $20 million.
“This now covers a significantly larger portion of this industry that will have their taxes reduced and will come at a loss to our counties. So I’ll be a no on this bill.”
The Senate passed Rader’s bill on a 28-19 vote. It had earlier been approved unanimously in the Senate Technology & Telecommunications Committee with a 7-0 vote.
The House author is Rep. Trey Caldwell.