Tax cuts, tribal relations dominate Stitt’s State of the State Address

Oklahoma Gov. Kevin Stitt implored lawmakers to send him tax cuts and said the continuing fallout from the Mc-Girt decision’s effect on tribal-state relations risks state unity, an assertion that left representatives of many of the state’s tribes sitting stone-faced in the gallery.

Stitt, in his sixth State of the State speech at the Oklahoma Capitol, struck a hopeful tone about the state’s future. He evoked President Ronald Reagan several times during the 41-minute speech, saying people are looking to Oklahoma as an example of Pilgrim John Withrop’s “shining city on a hill.”

The governor, who took office in 2019 and was reelected in 2022, touted the state’s recent economic performance and said lawmakers can help push the state toward continued prosperity if they share his goal of putting the state on a path to no income tax. He said he would sign any tax cut that reached his desk.

“The Oklahoma Standard is alive and well, and we are thriving as a state,” Stitt said. “But we can’t let our success make us complacent and forget what made the Oklahoma Dream possible: free enterprise and individual liberties. Not more government programs.”

Stitt, who championed a new government program that provides income tax credits for private schools, said public schools should also explore new models to focus on the workforce needs of the state’s business community. He asked lawmakers to give public charter schools more flexibility to employ old school buildings for new uses.

“Let’s put some of these vacant school facilities to use and get more high-performing charter schools up and running, especially in areas with failing public schools,” Stitt said. “More schools, more innovation, more freedom.”Stitt called for consolidation among the state’s colleges and universities and said the state had to stop subsidizing institutions with low enrollment and low graduation rates. At one point, Stitt contrasted the Navajo Reservation’s relationship with Arizona state government with Oklahoma’s relationship with the 39 tribes in the state.

“There are tribal governments who want Tulsa and eastern Oklahoma to look like the Navajo Reservation,” he said.

Stitt said he negotiated new compacts with the Chickasaw, Apache, Citizen Potawatomi and Wyandotte tribal governaments over the past few weeks. But he said work was still needed on taxes, agriculture, energy and water following the U.S. Supreme Court’s McGirt decision in 2020. The McGirt decision was limited to criminal jurisdiction.

“Three years after McGirt, we are still operating under a confusing and conflicting patchwork of jurisdiction across our state,” Stitt said. “It is imperative that we clarify our law enforcement relationships immediately.”

Chuck Hoskin Jr., the principal chief of the Cherokee Nation, said after the speech he was disappointed with Stitt’s continued, divisive rhetoric over the McGirt decision. “The picture he’s painted is one of confusion, and we don’t see it,” Hoskin said. “We see cooperation every day. If anyone’s looking for a perfect, flaw-free criminal justice system, they’re not going to find it. But I think we’ve got a lot of people that are working every day to make sure our system works.”

Hoskin said it was misguided to compare Arizona and the Navajo Reservation with the post-McGirt landscape in Oklahoma. He said the basic set of federal legal principles over tribal sovereignty remains the same.

“Because of the passage of time and historical forces, certainly the Cherokee Nation reservation may have different facets than the Navajo Reservation, but that doesn’t change the law,” Hoskin said. “We don’t change fundamental legal principles based on ZIP code. We look at what legal rights are at stake and apply the law.”

Stitt has called several special sessions to cut taxes, the most recent in January, to no avail. His executive budget proposal, released Monday, calls for mostly flat spending compared to fiscal year 2024.

“With record savings and surpluses, I’m asking, ‘If not now, when?’” Stitt said Monday. “In the 1990s, we were at 7% income tax. So I’m renewing my call. Let’s get Oklahoma back on the path to zero.”

But Democrats, and some Republicans, don’t see cutting income taxes as a realistic prospect, especially since many still in office had to manage downturns and revenue failures just a few years ago. House Minority Leader Cyndi Munson, D-Oklahoma City, said she remembers dealing with deficits totaling $1.5 billion in the first three years after she was first elected in 2016.

“There’s no way we can cut income taxes and continue to invest in Oklahoma,” Munson said in a press conference following Stitt’s speech. “He talked about flat budgets and calling on agencies to submit budget requests that are flat. A flat budget is a cut. There’s something called inflation. There’s something called fixed costs.”

Other Democrats noted the absence of any discussion of childcare from Stitt’s State of the State speech. They said quality and affordable childcare, including higher pay for childcare workers, would help both workforce and economic development.

Stitt’s references to criminal justice reforms were among the few moments that drew applause from Democratic lawmakers in the chamber. He said the state needs to limit fines, fees and court costs to only what’s needed for restitution. He also asked lawmakers to fix civil asset forfeiture, an effort in the past that has run into opposition from many in law enforcement.

“We’ve worked hard here to make sure we are prosecuting crimes and rehabilitating those with substance abuse and mental health struggles, and we are focusing on eliminating barriers for those who have served their time,” Stitt said.

Senate President Pro Tempore Greg Treat, R-Oklahoma City, said he’s staying open to the possibility of an income tax cut but wants to wait until the latest revenue estimates are released later this month. Treat repeated his call for the elimination of the state’s 4.5% sales tax on groceries.

“Oklahoma is one of the few states that still has a state tax on it,”Treat said in a press conference Monday afternoon. “It’s where the majority of middleincome families are hit the hardest. Oklahoma is unfortunately in the top 10 in a bad way in the average cost of groceries on a per-capita basis on people’s income. So I hope that he’s serious about that, and I hope we can afford it. We’re going to hold our powder dry until we see the numbers on Feb. 15.”