Dubious relation influencing Oklahoma's legislative branch

Here we illustrate questionable relationships between some state officials and those benefiting for the Tax Credit Abuse Sham.

Calvey, R-Del City, as chairman of the House Revenue and Taxation Committee, was a key player in shaping the subject tax credit legislation.

Paul Doughty is president of First State Bank of Altus and president of Oklahoma Industrial Venture Management Co., a limited liability company that profits from putting tax credit deals together and managing their investments.

Paul Doughty had told wealthy investors they can obtain $2 in state tax credits for every $1 invested (actually $3 for $1 since they keep the investment, and the $2 is all incentive) to help finance a new Altus aircraft manufacturer.

Shortly before State Rep. Kevin Calvey, was starting work on a Senate bill "to fix the loophole," Mr. Calvey received $21,600 in donations from an Altus group that is heavily involved in abusing this tax credit program. The Altus group includes Paul Doughty, several business associates and businesses. Altus is not in Calvey's House or congressional district.

Between Mr. Calvey receiving the donations and work was to start on the bill, Mr. Paul Doughty and Mr. Calvey discussed loophole and fixes.  

The donations at issue.

Paul Doughty President of First State Bank of Altus and> President Oklahoma Industrial Venture Management Co. $14,700  
Jane Doughty Wife of Paul Doughty $10,500  
F. Don Anderson Vice presidents of Altus Venture $10,500  
Lee Doughty First State Bank of Altus $1,500  
Larry McLaughlin First State Bank of Altus $1,500  
Robert O. McDonald Chief executive>Capital West Securities $250  
Note: $2,100 - was the maximum amount allowed by law for each election during 2006. Calvey never received enough votes to get past the primary election. .

Calvey states he was relying on the Tax Commission to determine what was best for the state.  

and the Tax Commission is only to execute the laws.

Rep. Fred Perry, R-Tulsa, coauthored one of the tax credit bills. He said he did not realize at the time that Great Plains would be allowed to sell $27 million in tax credits for nearly $23 million in cash. [A109]

The airline filed for Chapter 11 bankruptcy protection in January, citing "heavy debt" and a lengthy repair schedule for its aircraft. [A109]

"When I voted for the bill, my understanding was there wouldn't be any assistance until Great Plains made a profit," Perry said. "The whole idea of an income tax credit is when you have a profit and are in a position to pay income tax, then you get a credit for that from the state. That's what I thought I was voting for." [A109]

Lobbyist Margaret Erling, who represented Great Plains to the legislators, however, said the language in the tax bills was clear. [A109]

"The purpose of tax credits like this is for them to be resold. The state has issued tax credits for a lot of entities, including Goodyear and others, through the years," Erling said. "I do not feel there was any deception. These tax credits were overwhelming approved by the legislature in two sessions and were both signed by Gov. Keating."

Owl: The lawmaker that coauthored the bill is corrected by the lobbyist?

Rep. Darrell Gilbert, D-Tulsa, coauthored the second round of state assistance, which gave the company $9 million in tax credits. Great Plains sold the credits to Bank of Oklahoma for $7.7 million in cash. Gilbert said he was clear on how Great Plains would use the money. [A109]

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