Municipal Liaison Board to the OK Tax Commission
This Board was formed by the OML Board of Directors in April 2010 to further the League’s on-going efforts to increase municipal revenues.
The purpose of the Liaison Board is to identify problems with the Oklahoma Tax Commission (OTC) involving sales and use tax collections and enforcement; the Independent Auditor Program as well as accountability by OTC for the retainage paid by municipalities for enforcement of their sales tax ordinances.
Board is comprised of municipal officials chosen to represent
- The Liaison various municipal positions that deal with the Tax Commission,
- metro and non-metro municipalities, and
- all sections of the state.
- OML attorneys facilitate the Liaison Board’s meetings and activities.
The Liaison Board has authority to establish mechanisms for:
- accountability for the retainage fees paid by cities and towns,
- setting of priorities for OTC collection and enforcement activities,
- improving the contract terms and reporting methods, and
- involving municipalities in formulating OTC’s policies and procedures in its enforcement of municipal tax ordinances.
Joe Don Dunham Dana Ratcliffe
City Business Manager, Alva Treasurer, Weatherford
Ed Gordon Ross VanderHamm
City Manager, Bartlesville Finance Director, Edmond
Doug Haines John Vincent
Asst. City Manager & CFO, Woodward Attorney at Law
Stan Jones Diane Pedicord - Facilitator
Treasury Manager, Tulsa General Counsel, OML
Bob Ponkilla Sue Ann Nicely - Facilitator
City Treasurer, Oklahoma City Associate General Counsel, OML
Progress Report 8/7/13
Much progress has been made in the ensuing three years. At their first meeting on May 14, 2010, the Liaison Board members developed a list of priority issues which has guided its work to the present.
Municipal Liaison board Initial Issues
- Accountability for Retainage
This issue is being addressed by HB 1875, which is pending in committee for hearing next legislative session. The basis for the bill is confirmation obtained by the Liaison Board from OTC that cities and towns are paying OTC more than its weighted costs for administering municipal sales and use tax collection contracts.
- Audits: both by OTC and local authority for audits
Due to various discussions between the Liaison Board and OTC administrative staff, the Tax Commission has directed additional resources to conducting audits. Also, fully implementing the Independent Audit program has been an on-going effort by the Liaison Board.
In November 2012, the Tax Commission completed upgrading its computer system for tracking sales and use tax collections and reporting. The Liaison Board met with the OTC administrator several times prior to the upgrade to obtain a better reporting format to municipalities and request additional reports for local analysis.
- Information Sharing, including confidence building measures
The Liaison Board meets frequently with OTC Administrator Tony Mastin and other OTC staff to discuss issues. Since 2010, the relationship between the Liaison Board and OTC has improved and provided a mechanism to resolve problems and share information.
This issue has been enhanced in several ways through the work of the Liaison Board. OTC has cooperated with municipalities that decide to prosecute noncompliant sellers in municipal court. Additionally, the Liaison Board and OTC continue their work to fully implement legislation authorizing municipalities to engage in local compliance activities as agents of the Tax Commission.
The Liaison Board discusses processes and procedures on a regular basis with OTC.
- Reports: both form and content
OTC has developed new reports and/or report forms due to discussion with the Liaison Board. This includes making municipal reports available as an excel spreadsheet for easier analysis by each municipality.
- Sourcing, including out-of-state sales and use taxes
The Liaison Board discussed the sourcing process with OTC early in its existence. This is an on-going monitoring issue as circumstances arise. The Liaison Board also actively analyzes Oklahoma’s streamlined sales and use tax collections and monitors progress of federal legislation to collect sales and use tax on remote sales.
This again is an on-going monitoring task. The Liaison Board’s suggested changes to OTC’s reports were aimed at addressing this concern.
Vendors retain a percentage of sales taxes they collect. This “discount” was lowered by legislation in the 2010 session. The Liaison Board continues to monitor subsequent bills that would again increase the discount. Board members also continue to analyze the impact of the discount.
Although last on the priority list, revision of the contract between municipalities and OTC was the first major project for the Liaison Board. This led to numerous meetings with OTC staff and many frank conversations. A new contract was developed beginning with FY 2011-12. This contract provided, among other things, for a larger compliance role at the option of each municipality, enhanced information sharing, and better reporting to cities and towns.