Despite several senators saying the state already offers too many tax breaks, two measures providing sales tax exemptions won approval today in the state Senate.
House Bill 2019 would provide a tax refund of $354,000 on the construction of a 225-room, $7 million hotel being planned near Remington Park. The measure passed, 27-19.
HB 1387 would give a tax credit equal to 40 percent of the amount paid for equipment and installation of a wind or solar energy system for five years. Business owners also installing the environmentally-friendly system would get a 40 percent tax credit for five years. It passed, 33-13.
Both measures go to the House.
“I do not think this is a wise path for us to follow,” said Sen. Clark Jolley, R-Edmond. “Where do we stop?”
Jolley said all the exemptions will make it harder for legislators to significantly reduce its income tax rate. He cited a study that showed states with no income tax are attracting more people.
Sen. Andrew Rice, D-Oklahoma City, said the tax credit for wind and solar power would be an incentive for people concerned about the environment.
Jolley suggested those wanting to feel good about doing something about the environment to plant a tree. He said a home improvement store estimates planting three acres of trees would have as much benefit on the environment as installing a solar panel system on a house.
Sen. Jay Paul Gumm, D-Durant, said the hotel would help the entire state by enticing more tourists and visitors to go to Oklahoma City’s Adventure District.
In addition to Remington Park, the area has a zoo, a couple museums and a softball complex, he said. Those going to softball games usually stay in motels in western Oklahoma City, he said.
“It makes good sense … not just for northeast Oklahoma City but for the entire state,” he said.
Senate author Richard Lerblance, D-Hartshorne, said it is “a common sense measure.”
“The construction of this hotel will only serve to make the area an even more viable destination for entertainment,” he said.
Lerblance said Oklahoma’s horse industry has been revived by gaming compacts which have allowed for limited gaming at race tracks. Purses and crowds have increased, along with tax revenues, he said.
“The approval of this exemption can encourage a major investment in one of the state’s most frequently-visited entertainment locations,” he said.
Sen. Tom Ivester, D-Sayre, asked Lerblance if he would vote for a similar exemption if a hotel was being built in his district.
“Sure, why not?” Lerblance said.
What do you think? When should tax credits or exemptions be given? Or should they?