November 2007:
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Our Governor and Lawmakers really fixed that loophole. Within the first 4 months after the "law was (supposedly) fixed"
The "supposed fix" turned out to be a cover for making the loophole even more fraud friendly!
Between the time the law to supposedly outlaw the tax abuse loophole, took effect in June 2006
and November 2006, another $330 million was scammed from the same, but improved loophole.
We have yet to learn what has happened since November 2007, with officials refusing to release any information to the public.
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June 2007: Now the IRS is questioning the "tax loophole" claim.
March 2006 - Legislature initiates action to fix the legislation.
Their words.
March 2006 - Gov. issued an executive order to temporarily halt the
pre-approval process, until lawmakers study the issue.
Senate active on Bill 1693, calling for a moratorium until June 1, 2007.
March 26, 2006 - Moratorium Bill passed Senate and pending in the House [Ref A103]
Some strange things happen.
John Carey, D-Durant, says he has been removed as House author of the bill and
replaced by Odilia Dank, R-Oklahoma City. He won't say why. Dank says she was
asked to assume House authorship of the bill, but won't say who made the request.
April 25, 2006 - House approved Senate Bill 1693. Returning the bill to the Senate
April 27, 2006 - Sen. Ted Fisher, scratched the House-passed moratorium. [Ref A105]
May 26, 2006 - Senate approves plan to close loophole. [Ref A131]
Oklahoma Lawmakers passed legislation, SB1577 and the Governor into to law, that would effective immediately , in their words "plug the tax credit abuse loophole" that has been bleeding the states funds.
SB1577 stated "this act shall take effect and be in full force from and after its passage and approval." Making The law was effective June 7, 2006.
But then, $330 million more in tax credits were given,
under the old version of the law after the practice was outlawed.
As late as the following November, nearly five months after the law was passed, crony deal makers were bringing new ventures to the
Oklahoma Tax Commission which retroactively certified the ventures had been submitted prior to March 2006, i.e., prior to the effective date of the law.
An anonymous source informed us extra lawyers were brought in from out of state to generate as many new applications as possible.
Another case of corrupt state officials misusing their authority to override the law to facilitate fraudulent receiving of public money.
This is not all, the applications were all rubber stamp approved without due diligence, evaluation, guidelines as to how the money is to be used.
There has been no money set aside for these gifts. The money will have to be taken from
other long suffering from underfunding.
Considering the history of past legislator regarding this tax abuse can
gives us no comfort. That history to review the major parts is as follows.
- According to Sen. Ted Fisher is Senate's majority floor leader at the time, the abuses started after some unknown person "tweaked" the law, and he failed to notice. [Ref A103]
- Lawmakers supposedly closed the loophole before to later learn the fix didn't stick. The Legislature tried to close the loophole last year by eliminating borrowed money from tax credit calculations, but tax attorneys figured out a way to circumvent the prohibition using limited liability companies. [Ref A104]
- Beneficiaries of loophole, including Paul Doughty, in the tax credit program have contributed $21,900
to the campaign of state Rep. Kevin Calvey's chairman of the House Revenue and Taxation Committee just as he taking on the task of "trying to close" the loophole. [Ref A104]
- Then Mr. Calvey sought out Mr. Doughty for his input and "He (Doughty) did express concern that there were some legitimate programs going on and he didn't want them to be thrown out with the bad ones," [Ref A104]
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