Year 8 - Evaluation Schedule

Estimated Incentive Cost
$8.94 million (2019-2022)

Program Type
Tax incentive

Citation
62 O.S. sec. 840

Industry
Enterprise Zones, Tourism, Military

Sunset
Project must be completed no later than December 31, 2024

Review Year
8

Provides funding for local units of government to match local tax revenue dedicated to support a project located in an enterprise zone. Eligible projects must be located entirely in an enterprise zone, in support of a major tourism destination, or in support of a military growth impact.

Estimated Incentive Cost
$882,515 (FY 2022)

Program Type
Other

Citation
Oklahoma Administrative Code
§ 780:25-5-1

Industry
Various

Review Year
8

Provides reimbursements for workforce trainings conducted by new or expanding companies in Oklahoma. The program is intended to serve companies exporting goods and services in the following ecosystems: Manufacturing: Aerospace and Defense: Energy; Transportation and Distribution; Agriculture and Biosciences; Information and Financial Service; and Health. The Oklahoma Department of Career and Technology Education (ODCTE) oversees administration of the program in conjunction with technology centers across the state, who directly interface with the companies benefitting from the program. Trainings can be fully reimbursed by the program.

Estimated Incentive Cost
N/A

Program Type
Tax exemption

Citation
68 O.S. § 1357, 68 O.S. 1357.4, 68 O.S. § 1357.5, 68 O.S. § 1404.3, 68 O.S. § 1404.4

Industry
Aerospace

Sunset
None Found

Review Year
8

Oklahoma offers multiple sales tax exemptions for use by qualified aircraft maintenance or manufacturing facilities (aircraft facilities). The exemptions apply to sales of: (1) computers, data processing equipment, related peripherals and telephone, telegraph, or telecommunication services and equipment; and (2) tangible personal property consumed or incorporated in construction or expansion.

Estimated Incentive Cost
None

Program Type
Tax exemption

Citation
§68-54001 - §68-54006, §68-1357v2

Industry
Information Technology

Sunset
None Found

Review Year
8

The Computer Services, Data Processing, and Research and Development Tax Exemption was established by two different additions to Oklahoma state statute. One section, § 68-54001 - 54006, was repealed effective November 1, 2022. This section provided a refund of state and local sales and use taxes to qualified purchasers primarily engaged in computer services and data processing or research and development. Qualified purchasers were defined as new or expanding businesses that added at least 10 new full time employees who received at least $35,000 annually in compensation and maintained them for at least 36 months.

The other section of the computer services and data processing sales tax exemption, § 68 -1357v2 - 21, is still active but has not been used. This program exempts state sales and use taxes on the purchase of machinery and equipment by persons and establishments primarily engaged in computer services and data processing. These entities must derive at least 50 percent of their annual gross revenues from the sale of a product or service to an out-of-state buyer or consumer if they are defined under Industrial Group Numbers 7372 and 7373 of the Standard Industrial Classification Manual, or, if they are defined by Industrial Group Number 7374 and derive at least eighty percent of their annual gross revenues of a product or service to an out-of-state buyer or consumer. Notably, unlike § 68-54001 – 54006, this sales tax exemption does not include the research and development industries.

Estimated Incentive Cost
$583,000 (FY2018-2022

Program Type
Tax refund or rebate

Citation
68 O.S. 1359.1

Industry
Construction

Sunset
None Found

Review Year
8

Oklahoma refunds sales taxes paid on construction materials for certain new or expanding manufacturing facilities including: facilities with construction costs exceeding $5 million which create 100 new manufacturing jobs and are maintained for a minimum of 36 months. Construction costs include building and construction costs, and engineering and architectural fees, but not legal fees. Facilities with construction costs exceeding $10 million, and with combined total costs of material, construction, and machinery exceeding $50 million, which add 75 new employees who are retained for 36 months. Facilities with construction costs exceeding $300,000,000 which maintain an employment level of at least 1,750 full time employees. Qualified new or expanding aircraft maintenance and overhaul facilities that create 250 or more jobs, with construction costs totaling at least $5 million.

Estimated Incentive Cost
$69.6 million (2022)

Program Type
Other

Citation
62 O.S. § 891.1 et seq.

Industry
Multiple

Sunset
None Found

Review Year
8

The Economic Development Pooled Finance Program was established in 2009 by the Oklahoma Community Economic Development Pooled Finance Act. The Legislature sought to support economic development and public infrastructure projects for the purpose of attracting private investment, creating jobs, and developing infrastructure essential to a safe and productive environment for state residents and visitors.

The program seeks to accomplish this through a $200 million pool of financing made available to for-profit entities for a local infrastructure or economic development project. Cash payment awards for approved projects are determined by the Department of Commerce (Department) and ultimately disbursed by the Oklahoma Development Finance Authority (ODFA), working in conjunction with the Oklahoma Tax Commission (OTC). The funding is repaid through payroll tax rebates generated by a for-profit entity receiving funding, or a new tax or tax increase levied by the local governments receiving funding.

There are three options within the Economic Development Pooled Finance Program: the Business Expansion Incentive Program (BEIP), the Oklahoma Innovation Expansion Program (OIEP), and the Public-Private Partnership Pooled Finance Program (P3).

Estimated Incentive Cost
$2.9 million (2021)

Program Type
Tax Credit

Citation
68 O.S. sec.2357.104

Industry
Rail

Sunset
None Found

Review Year
8

Oklahoma’s Railroad Modernization Tax Credit is equal to 50 percent of qualified railroad reconstruction or replacement expenditures incurred by a Class II or Class III railroad. The amount of the credit is limited to $5,000 per mile of railroad track owned or leased within the State by the taxpayer. The total amount of credits used to offset tax liability is limited to $5 million per year

Estimated Incentive Cost
$15,475,000 (FY 2022)

Program Type
N/A

Citation
62 O.S. 2001

Industry
Rural Development

Sunset
None Found

Review Year
8

The Oklahoma Legislature created a grant program with a goal to “remove impediments to economic development in rural areas to alleviate the sometimes negative effects of lower population density, population decreases and increased demand for governmental services and to maintain a desirable quality of life for residents and other legal entities in rural areas.” The Rural Economic Development Action Plan (REAP) provides funding to infrastructure projects in rural areas to meet this goal. Funds are available for cities or towns with a population of 7,000 or less.