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ENGROSSED SENATE
BILL NO. 1919 By: Thompson of the Senate
and
Townley of the House
An Act relating to Oklahoma Tourism Development Act;
amending 68 O.S. 2021, Section 2397, as last amended
by Section 1, Chapter 83, O.S.L. 2025 (68 O.S. Supp.
2025, Section 2397), which relates to inducement
claims; increasing cumulative inducement per year;
updating statutory language; and providing an
effective date.
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. AMENDATORY 68 O.S. 2021, Section 2397, as
last amended by Section 1, Chapter 83, O.S.L. 2025 (68 O.S. Supp.
2025, Section 2397), is amended to read as follows:
Section 2397. A. Upon receiving notification from the Chief
Executive Director Officer of the Oklahoma Department of Commerce
that an approved company has entered into a tourism project
agreement and is entitled to the inducements provided by the
Oklahoma Tourism Development Act, the Oklahoma Tax Commission shall
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provide the approved company with forms and instructions as
necessary to claim or receive or pass-through those inducements.
B. An approved company whose agreement provides that it shall
expend approved costs of more than Five Hundred Thousand Dollars
($500,000.00) for a tourism attraction project but less than One
Million Dollars ($1,000,000.00) shall be entitled to a sales tax
credit if the company certifies to the Tax Commission that it has
expended at least the minimum amount in approved costs, and the
Chief Executive Director Officer certifies that the approved company
is in compliance with the Oklahoma Tourism Development Act. The Tax
Commission shall then issue a tax credit memorandum to the approved
company granting a sales tax credit in the amount of up to ten
percent (10%) of the approved costs, but limited to the percent of
the approved costs that will result in the project being revenue-
neutral to this state as determined by the Oklahoma Department of
Commerce. Subsequent requests for credit for additional certified
approved costs in excess of the minimum amount for each project as
listed in this subsection but less than One Million Dollars
($1,000,000.00) shall result in a sales tax credit in the amount of
up to ten percent (10%) of the approved costs, but limited to the
percent of the approved costs that will result in the project being
revenue-neutral to this state as determined by the Oklahoma
Department of Commerce. Sales tax credits allowed pursuant to the
provisions of the Oklahoma Tourism Development Act shall not be
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transferable or assignable; provided that, with respect to a tourism
attraction project that is an Entertainment District, the approved
company can elect to pass-through all or a portion of the sales tax
credit to one or more Entertainment District Tenant Parties. The
approved company and the Entertainment District Tenant Party shall
jointly file a copy of the written credit pass-through agreement
with the Oklahoma Tax Commission within thirty (30) days of the
effective date of the agreement. Such filing of the agreement with
the Oklahoma Tax Commission shall perfect such agreement. The
written agreement shall contain the name, address, and taxpayer
identification number of the parties to the agreement, the amount of
credit being passed-through, the month and year the credit was
originally allowed to the approved company, the month and tax year
or years for which the credit may be claimed, and a representation
by the approved company that the approved company has neither
claimed for its own behalf nor conveyed such credits to any other
Entertainment District Tenant Party. The Tax Commission shall
develop a standard form for use by an approved company and an
Entertainment District Tenant Party demonstrating eligibility for
the Entertainment District Tenant Party to utilize the sales tax
credit. The Tax Commission shall develop a system to record and
track the pass-through of the sales tax credit and certify the
ownership of the sales tax credit and may promulgate rules to permit
verification of the validity and timeliness of a sales tax credit
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claimed upon a sales tax return pursuant to this subsection but
shall not promulgate any rules which unduly restrict or hinder the
pass-through of such sales tax credit to an Entertainment District
Tenant Party.
An approved company whose agreement provides that it shall
expend approved costs in excess of One Million Dollars
($1,000,000.00) shall be entitled to a sales tax credit if the
company certifies to the Tax Commission that it has expended at
least One Million Dollars ($1,000,000.00) in approved costs and the
Chief Executive Director Officer certifies that the approved company
is in compliance with the Oklahoma Tourism Development Act. The Tax
Commission shall then issue a tax credit memorandum to the approved
company granting a sales tax credit in the amount of up to twenty-
five percent (25%) of the approved costs, but limited to the percent
of the approved costs that will result in the project being revenue-
neutral to this state as determined by the Oklahoma Department of
Commerce. The credit on all subsequent additional certified
approved costs shall be in the amount of up to twenty-five percent
(25%) of the costs, but limited to the percent of the approved costs
that will result in the project being revenue-neutral to this state
as determined by the Oklahoma Department of Commerce. For a tourism
attraction project that is an Entertainment District, an approved
company may elect to receive an incentive payment based on sales tax
collections of Entertainment District Tenant Parties rather than a
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sales tax credit. The incentive payment shall be in the amount of
up to twenty-five percent (25%) of the approved costs but limited to
the percent of the approved costs that will result in the project
being revenue-neutral to this state as determined by the Oklahoma
Department of Commerce; provided that, (A) in no event shall the
incentive payments exceed the increased state sales tax liability of
the approved company and the Entertainment District Tenant Parties
that is actually received by the Tax Commission, and (B) the
approved company shall be entitled to receive only ten percent (10%)
of the incentive payment amount during each calendar year. The Tax
Commission shall issue an incentive payment memorandum to the
approved company granting a right to receive an incentive payment
from the Tax Commission in the amount of up to twenty-five percent
(25%) of the approved costs but limited to the percent of the
approved costs that will result in the project being revenue-neutral
to this state as determined by the Oklahoma Department of Commerce.
As soon as practicable after the end of each calendar year during
the term of the agreement, the approved company shall file a claim
for the incentive payment with the Tax Commission, and the Tax
Commission shall be responsible for ensuring that the amount of the
incentive payment claimed does not exceed the increased state sales
tax liability of the approved company and the Entertainment District
Tenant Parties that has been actually received by the Tax
Commission, which may include accessing the Oklahoma state sales tax
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returns of the Entertainment District Tenant Parties as permitted by
this section.
The cumulative inducements provided pursuant to the Oklahoma
Tourism Development Act shall not exceed Thirty Million Dollars
($30,000,000.00) Sixty Million Dollars ($60,000,000.00) per year.
The Tax Commission shall require proof of expenditures prior to
issuing a tax credit memorandum or incentive payment memorandum to
the approved company which may be satisfied by a report from an
independent certified public accountant. Additional credit
memoranda or incentive memoranda may be issued as the approved
company certifies additional expenditures of approved costs.
No tax credit memorandum or incentive payment memorandum shall
be issued for any approved costs expended after the expiration of
three (3) years from the date the agreement was signed by the Chief
Executive Director Officer and the approved company. However, the
Chief Executive Director Officer, with the advice and consent of the
Tax Commission, may authorize inducements for approved costs
expended up to five (5) years from the date the agreement was signed
if the Chief Executive Director Officer determines that the failure
to complete the tourism attraction project within three (3) years
resulted from:
1. Unanticipated and unavoidable delay in the construction of
the tourism attraction;
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2. An original completion date for the tourism attraction, as
originally planned, which will be more than three (3) years from the
date construction began; or
3. A change in business ownership or business structure
resulting from a merger or acquisition.
C. A sales tax credit allowed pursuant to the provisions of
this section may be used to offset a portion of the reported state
sales tax liability of the approved company or an Entertainment
District Tenant Party, if applicable, for all sales tax reporting
periods following the issuance of the credit memorandum subject to
the following limitations:
1. Only increased state sales tax liability may be offset by
the issued credit;
2. An approved company whose agreement provides that it shall
expend approved costs in excess of One Million Dollars
($1,000,000.00) or an Entertainment District Tenant Party, if
applicable, shall be entitled to use only ten percent (10%) of the
amount of each issued credit to offset increased state sales tax
liability during each calendar year, plus the amount of any unused
credit carried forward from a prior calendar year, and an approved
company whose agreement provides that it shall expend approved costs
of more than the minimum amount for each project as listed in this
subsection but less than One Million Dollars ($1,000,000.00) shall
be entitled to use only twenty percent (20%) of the amount of each
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issued credit to offset increased state sales tax liability during
each calendar year, plus the amount of any unused credit carried
forward from a prior calendar year; and
3. All issued credit memoranda or incentive payment memoranda
shall expire at the end of the month following the expiration of the
agreement as provided in Section 2396 of this title.
The approved company or an Entertainment District Tenant Party,
if applicable, shall have no obligation to refund or otherwise
return any amount of this inducement to the person from whom the
sales tax was collected.
D. The Tax Commission shall promulgate rules as are necessary
for the proper administration of the Oklahoma Tourism Development
Act. The Tax Commission may also develop forms and instructions as
necessary for an approved company or Entertainment District Tenant
Party, if applicable, to claim or receive or pass-through the
inducements provided by the Oklahoma Tourism Development Act.
E. The Tax Commission shall have the authority to obtain any
information necessary from or regarding the approved company or an
Entertainment District Tenant Party, if applicable, and the Chief
Executive Director Officer to verify that approved companies or an
Entertainment District Tenant Party, if applicable, have received
the proper amounts of inducements as authorized by the Oklahoma
Tourism Development Act. The Oklahoma Tax Commission shall demand
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the repayment of any inducements taken or received in excess of the
inducements allowed by the Oklahoma Tourism Development Act.
F. No sales tax credit or incentive payment right authorized by
this section shall be granted on or after January 1, 2032.
Notwithstanding the foregoing, an approved company that has entered
into a tourism attraction project agreement with the Oklahoma
Department of Commerce pursuant to Section 2396 of this title prior
to January 1, 2032, shall continue to be entitled to claim or
receive any inducements authorized by this section as contemplated
by the tourism project agreement.
G. All currently approved tourism project agreements executed
by the Oklahoma Tourism and Recreation Department are hereby
transferred to the Oklahoma Department of Commerce upon November 1,
2021.
H. On November 1, 2021, all administrative rules promulgated by
the Oklahoma Tourism and Recreation Department regarding the
Oklahoma Tourism Development Act shall be transferred to and become
a part of the administrative rules of the Oklahoma Department of
Commerce. The Office of Administrative Rules in the Office of the
Secretary of State shall provide adequate notice in the “The
Oklahoma Register Register” of the transferred rules and shall place
the transferred rules under the Oklahoma Administrative Code section
of the Oklahoma Department of Commerce. On November 1, 2021, any
amendment, repeal, or addition to the transferred rules shall be
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under the jurisdiction of the Oklahoma Department of Commerce, who
shall have the authority to enact rules in order to carry out the
provisions of the Oklahoma Tourism Development Act.
SECTION 2. This act shall become effective November 1, 2026.
Passed the Senate the 16th day of March, 2026.
Presiding Officer of the Senate
Passed the House of Representatives the ____ day of __________,
2026.
Presiding Officer of the House
of Representatives