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STATE OF OKLAHOMA
1st Session of the 60th Legislature (2025)
HOUSE BILL 1146 By: Humphrey
AS INTRODUCED
An Act relating to revenue and taxation; authorizing
county to call an election for taxing certain
materials upon severance; providing exceptions;
stating persons who may call election; requiring
voter approval of tax; requiring county to identify
purpose of tax; providing for subsequent election
within certain time period if question fails;
providing effective date of approved levy or change
in tax rate; providing maximum tax rate that may be
approved; providing apportionment of tax to specific
funds; requiring certain notice by Oklahoma Tax
Commission; authorizing certain contract for
specified purposes; providing certain contractual
powers of Tax Commission; providing certain terms of
contract; providing procedures for initiative
petition for severance tax; providing certain tax
credit; prohibiting certain penalty by county for
specified privilege; providing for codification; and
providing an effective date.
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 1001.5 of Title 68, unless there
is created a duplication in numbering, reads as follows:
A. Any county of this state is hereby authorized to levy a tax
upon the severance of all materials which are surface mined, not
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including coal, for purposes of producing aggregate within the
territorial limits of the county by any lawfully recognized for-
profit business entity in an amount specified in the special
election called as provided herein.
B. No severance tax shall be applicable to:
1. Materials extracted by an individual person or persons from
real property owned by such person or persons and not sold for
profit; or
2. Limestone extracted for agricultural purposes.
C. Sales of sand for use in hydraulic fracturing operations and
sales of materials to be used by individuals for the production of
goods within this state shall be exempt from any severance tax
levied pursuant to this section. In order to administer the
exemptions for sales provided in this subsection, there shall be
made a severance tax refund for severance taxes paid. Refunds shall
be made in a manner prescribed by the county which levies the tax.
D. Before a severance tax may be levied by the county, the
imposition of the tax shall first be approved by a majority of the
registered voters of the county voting thereon at a special election
called by the board of county commissioners or by an initiative
petition signed by not less than five percent (5%) of the registered
voters of the county who were registered at the time of the last
general election. The question submitted shall be limited to the
purposes described by subsection F of this section and shall be
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stated on the initiative petition. The county shall identify the
purpose of the severance tax when it is presented to the voters
pursuant to the provisions of this section. However, if a majority
of the registered voters of a county voting fail to approve such a
tax, the board of county commissioners shall not call another
special election for such purpose for one (1) year.
E. Any tax levied or any change in the rate of a tax levied
pursuant to the provisions of this section shall become effective on
the first day of the calendar quarter following approval by the
voters of the county unless another effective date, which shall also
be on the first day of a calendar quarter, is specified in the
ordinance or resolution levying the tax or changing the rate of the
tax. The county may approve a severance tax up to ten cents ($0.10)
per ton on the production of all materials which are surface mined,
not including coal.
F. The revenues collected by the county from the severance tax
which may be levied shall be apportioned as follows:
1. Fifty percent (50%) shall be deposited in the county general
fund and shall be designated for construction and improvement of
county and municipal roads and bridges; and
2. Fifty percent (50%) shall be apportioned to the general
revenue fund of municipalities within the county on a proportional
basis of their population according to the most recent Federal
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Decennial Census. Revenues apportioned to the general revenue fund
of a municipality shall be designated for infrastructure projects.
G. The life of a tax levied pursuant to the provisions of this
section may be limited or unlimited in duration. The county shall
identify the duration of the tax when it is presented to the voters
pursuant to the provisions of this section.
H. The Oklahoma Tax Commission shall give notice to all
relevant taxpayers of a rate change at least sixty (60) days prior
to the effective date of the rate change. Failure to give notice as
required by this section shall delay the effective date of the rate
change to the first day of the next calendar quarter. The board of
county commissioners of a county levying a tax pursuant to the
provisions of this section and the Tax Commission are authorized to
enter into a contract whereby the Tax Commission shall have
authority to assess, collect, and enforce the tax and any penalties
or interest thereon levied by the county and to remit the same to
the county. Such authority shall apply to any tax levied pursuant
to this section and penalty or interest liability existing at the
time of contracting. Upon contracting, the Tax Commission shall
have the power of enforcement of the tax, penalties, or interest
that is vested in the county. The contract shall provide for the
assessment, collection, and enforcement of the tax, penalties, or
interest in the same manner as the administration, collection, or
enforcement of the state gross production tax by the Tax Commission.
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For providing such assistance, the Tax Commission shall charge the
county a fee of one-half of one percent (1/2 of 1%) of the gross
collection proceeds.
I. Initiative petitions calling for a special election
concerning county severance tax proposals shall be in accordance
with Sections 2, 3, 6, 18, and 24 of Title 34 of the Oklahoma
Statutes. Petitions shall be submitted to the office of the county
clerk for approval as to form prior to circulation. Following
approval, the petitioner shall have ninety (90) days to secure the
required signatures. After securing the requisite number of
signatures, the petitioner shall submit the petition and signatures
to the county clerk. Following the verification of signatures, the
county clerk shall present the petition to the board of county
commissioners. The special election shall be held within sixty (60)
days of the board of county commissioners receiving the petition
from the county clerk.
SECTION 2. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 1001.6 of Title 68, unless there
is created a duplication in numbering, reads as follows:
A. All materials sold where an appropriate county sales tax was
charged, collected, and remitted to the county where the materials
were severed shall receive a credit against the severance tax in the
same amount of the sales tax portion that was remitted to the county
of origin.
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B. No county that receives revenue from a severance tax levy on
materials as authorized by this act shall impose any fee, charge,
assessment, or other cost for the privilege of engaging in the
mining or extraction of materials.
SECTION 3. This act shall become effective November 1, 2025.
60-1-10095 AO 12/31/24