UPDATE: This amendment was passed by the Senate committee on a 6-1 vote. All Republicans on the committee voted yes. The two Democrats split their votes.
A source in the state Senate tells me that this afternoon at a 2:00pm meeting of the Senate Finance and Tax Committee an amendment will be offered to HB1476, the oil tax reform plan which Democrats have been describing as a”doomsday” proposal.
Here’s the changes according to what I’ve been told:
- Current oil tax triggers stay in place until 2016
- On January 1st, 2016, the current triggers are replaced with a new trigger at $90 per barrel indexed to inflation. Above the trigger price the top rate is 11 percent (currently the top rate is 11.5 percent) below that trigger the top rate is 10 percent.
- When this new trigger goes into place most existing triggers/exemptions from the oil tax go away.
I was a bit skeptical when I first heard of the proposal, but supporters of HB1476 think this may be an improvement.
Currently the bill is a “trigger on a trigger” kicking in a flat and permanent 9.5 percent rate when the existing trigger exemption hits (expected to be June 1st). “This is much better then trigger on trigger as the amendment guarantees rate cut in January,” a House member told me.
The intent of the amendment is to get some bipartisan compromise from Democrats and the Three Affiliated Tribes who both came out in opposition to the bill originally.
“The Democrat argument is when oil recovers we lose bunch of money, but with reserve trigger it ensures that argument is void,” my House source told me. Basically, the Republicans are agreeing to higher on-going rates in exchange for a guaranteed date when the current triggers will go away.
I agree that the “trigger on the trigger” provision in the current bill wasn’t great (what if the trigger never hits?), but I think we could have come down further in rates given what the oil industry is giving in up terms of lost exemptions. But this is a country mile better than the status quo. If this is what it takes to get rid of the triggers, so be it.
The Senate committee is expected to kick out the amendments to the floor for a vote this afternoon. If approved the House and Senate would have to reconcile the differences between the bills in conference committee.
Given what I’m hearing from the House side, that might not be too hard.
Question is, how many Democrats will get on board with this after some of their hyperbole on this bill over the last few days? Will they recognize compromise when they see it, or stick to their partisan guns?
UPDATE: The amendment had bipartisan sponsorship, according to Amy Dalrymple.