Nick Baker - The Prowling Owl
keeps a watchful eye on
Oklahoma state government.THE PROWLING OWL: THE FRAUD, FALSE REPORTING AND
COVER-UP CONTINUEBy Nick Bake NORMAN, Okla. -- Evidence OTC has been under reporting tax credit program cost by reporting amounts less than 20% and one as little as 2% of information found on other OTC documents. OTC reported two programs as receiving no money yet other OTC documents reveal $281 million.
This is a prelude for a follow up graphic depictions of the extent of false reporting used to hide fraud inflicting the current financial disaster on Oklahoma taxpayers by state legislators.’ Fraud ridden tax credit programs funded using the state’s untracked and unaccounted Tax Expenditure program.
With Oklahoma, experiencing tax revenue short falls ranging in the 25 to 30% of the state’s current, $7 Billion appropriations budget. Oklahoma taxpayers will be facing tax increases to make up what could amount to a $1.5 Billion shortfall; then fund expected future shortfalls that can’t be absorbed in spending cutbacks. The economy, which we have little control, is only partly to blame for the shortfalls, and the least responsible. The more insidious cause is the result of rapidly increasing use of funding tax credit programs using “off the books” Tax Expenditures. State officials have never treated Tax Expenditures the same as appropriations spending. Leaving Tax Expenditures free of budgeting restraints, oversight, tracking and accountability.
When this new fangled thing called tax credits was discovered by government officials in the early 1980s, the tax credit programs were put under Tax Expenditures. Soon creative uses like allowing tax credits to be sold for cash opened the door allowing funding with the illusion there was no increase in budget spending. Tax credits are a way to allow beneficiaries to skim off incoming tax revenue before it reaches the state’s coffers and accountability. This spending does not appear as appropriations spending but is reflected in tax revenue shortfalls.
The only information provided the Oklahoma public about Tax Expenditures is in a biannual Tax Expenditure report (TER) prepared by the Oklahoma Tax Commission (OTC). While OTC reported $5.4 Billion in Tax Expenditures for 2007-2008 the $5.4 Billion only accounts for 150 of the 500 Tax Expenditure programs. The remaining 350 are reported as “Zero” or N/A. Only 38 of the state’s 80 plus tax credit programs show values which total $68 million.
Examining other state reports that could be obtained, including other OTC reports’ reveals those 38 tax credit programs cost $370 million, a 545% under reporting. Two of the 4 fraud ridden programs where reported as costing $4.8 million and the examination revealed $98 million, under reported by 2,040%. OTC has been reporting $0 cost for the other two of the 4 fraud ridden programs going back to 2005. Examination reveals OTC authorized $281 million in tax credits for those two programs.
These two unreported programs are the Small Business Ventures (SBV) and Rural Small Business Ventures (RSBV), not to be confused with the Small Business Capital Company (SBC) and Rural Small Business Capital Company (RSBC) tax credit programs. The close similarity of terms confuses most into believing the SBC and RSBC are the same or include the numbers for SBV and RSBV. SBV and RSBV are the two programs structured to allow secret involvement in a public funded program paying out $100s million in unearned public funds. Nowhere could we find were OTC reported either the amounts or identities of those receiving tax credits under these two programs.
Given the fact Oklahoma has no law preventing public officials from benefiting from public funded programs these two programs, I submit, were created and operated to reward state official for allowing and protecting the fraud.
The only sign of these two programs is an entry on OTC’s Incentive Review Capco report labeled, not with the proper names, but with the vague term “in conjunction.” There we find some very large numbers, including the largest single entry found on any tax credit report, $133 million attributed to one of the Altus Ventures group of LLCs. The connection to SBV or RSBV can only be found buried in the boring details of the law creating the program. Nowhere else can one find OTC labeling any tax credit amounts authorized or used by the proper terms Small Business Ventures (SBV) and Rural Small Business Ventures (RSBV).
The only accountability state officials provide for reportedly nearly $3 Billion of public spending is so riddled with discrepancies and falsehoods the public is being purposely prevented from learning how one-third of its taxes are used. Mislead and deceived about where the money is going, how the money is used and what if any benefits.
In reality, we should need no proof of the actual acts of wrong doing to see the irresponsible way state officials are operating. Handing out keys to an unguarded state treasury is begging for fraud.
Tulsa World reporter, Randy Krehbiel, and others, inside and outside Oklahoma, have been have been warning of the dangers of Tax Expenditures for several years. Those warnings have been ignored. ******************
Senator Glenn Coffee confirmed today that one of his first reforms of state government will be in the form of authoring legislation ending the Senate’s tag agency patronage system by prohibiting lawmakers from recommending tag agents to the Oklahoma Tax Commission (OTC).
In the past, Oklahoma State Senators have suggested to OTC those individuals they thought should hold the position of tag agent. Under Coffee’s legislation, the Oklahoma Tax Commission will directly appoint tag agents.
“Traditionally, the OTC has followed the recommendations of the local senators in filling these positions,” said Coffee. “This legislation simply removes patronage and returns professionalism to the appointment and management of tag agencies.
“This is a reform that is long overdue, and I believe it will be greeted with bi-partisan enthusiasm,” he continued. “It’s time for this patronage to end, and I’m happy to bring it to a painless, peaceful conclusion.”
Oklahoma and Tulsa counties have been out from under the patronage system for many years with significant success, and Coffee says this reform brought by the new Senate majority will bring professional management to the tag agency system.
Number 2 Porker of the Month !The UK-based vehicle licence plate manufacturer, Hills Numberplates Ltd, has chosen long-range RFID tags and readers from Identec Solutions to be embedded in licence plates that will automatically and reliably identify vehicles in the UK.
The new e-Plates project uses active (battery powered) RFID tags embedded in the plates to identify vehicles in real time. The result is the ability to reliably identify any vehicle, anywhere, whether stationary or mobile, and - most importantly - in all weather conditions. (Previous visually-based licence plate identification techniques have been hampered by factors such as heavy rain, mist, fog, and even mud or dirt on the plates.)
The e-Plates project has been under development for the past three years at a cost of more than £1 million, and is currently under consideration by a number of administrations. It is hoped that e-Plate will be one of the systems trialled by the UK Government in its forthcoming study of micro-chipped licence plates.
Chipped plates
The plates are the same shape and size as conventional plates, and are permanently fitted to the vehicle in the same way. But each e-Plate contains an embedded tag with a unique, encrypted identification number that is transmitted by the tag for detection by RFID readers. Multiple tags can be read simultaneously by a single reader at speeds of up to 320km per hour (200mph), up to 100 metres (300 feet) away.
The reader network, which includes fixed location readers (for use on the roadside) and portable readers (for use in surveillance vehicles and handheld devices), sends the unique identifier in real time to a central system where it is matched with the corresponding vehicle data such as registration number, owner details, make, model, colour, and tax/insurance renewal dates.
Identities secured
A key benefit of the e-Plate is that the tag provides an encrypted and secure ID code which is registered in the UK Ministry of Transport's vehicle database. This code prevents tampering, cloning, or other forms of fraud that can currently happen with camera-based systems.
Additionally, the e-Plate is designed to shatter if anyone tries to remove or otherwise tamper with it, and the tag can be programmed to transmit a warning if any attempt is made to dislodge the plate.
Surveillance applications
The system is expected to be used to identify vehicles for applications such as security, access control, electronic payment, tracking and processing, traffic management, and customer service. Commercial applications could include car dealerships, rental companies, insurance companies, fleet operators, and parking garages. In the public sector, the main applications would include enforcement (compliance with road tax, insurance, and mechanical checks), access control to restricted areas, combating vehicle theft and associated crime, and traffic flow counting and modelling.
According to Richard Taffinder, operations director for Hills Numberplates, the e-Plates were developed to provide companies and public authorities with a more reliable way to positively identify and capture information on a vehicle.
Federal tax rebate won't be taxedAFX News OKLAHOMA CITY (AP) - State income taxes will not have to be paid on pending federal income tax rebates, a spokeswoman for the Oklahoma Tax Commission said Monday.
However, Oklahomans who owe back taxes or money to the government for such things as delinquent student loans and child support payments will have their rebate checks wiped out or reduced.
Paula Ross, Tax Commission spokeswoman, said the rebates are not being considered as income at the federal level, so they also will not be taxed at the state level.
'But people who owe the state or federal government may have the rebates snagged' just as regular tax refunds are captured, she said.
The rebates are part of an economic stimulus package scheduled to be signed into law by President Bush on Wednesday.
Most single taxpayers will get $600 rebates and most married taxpayers will get $1,200, plus $300 per child. Officials hope taxpayers will spend most of their money on goods and services to spur the national economy.
Oklahoma legislators had taken steps to ensure state taxpayers would not be penalized on their state income taxes because of the rebates.
Senate President Pro Tem Mike Morgan, R-Stillwater; Co-President Pro Tem Glenn Coffee, R-Oklahoma City, and House Speaker Chris Benge earlier said they supported legislation to deem the federal rebates as nontaxable on the state level.
Morgan said the idea of the stimulus package is to have taxpayers 'take that money and spend it on main streets across the country, including right here in Oklahoma.
'I am certainly in favor of ensuring Oklahomans do not have to pay state income taxes on those rebate checks. Those rebate checks are intended to pump money into our economy and not back into the state coffers.'
Rep. Randy Terrill, R-Moore, chairman of the House Revenue and Taxation Committee, said concern that the tax rebates may be taxed by the state was probably due to a situation that developed when federal taxes had to be paid on state tax rebates a few years ago.
'Generally, federal tax rebates are not taxed at the state level,' Terrill said.
Sen. Don Barrington, R-Lawton, had prepared an amendment to ensure the federal tax money was not taxed, just in case. The amendment was planned for his bill expanding the fall sales tax holiday to include school supplies.
