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Okla. leaders nearing deal on income tax cut

Sean Murphy, Associated Press

OKLAHOMA CITY (AP) -- A plan to slash Oklahoma's top personal income tax rate could be unveiled next week, but state leaders acknowledged Thursday that the deal hinges on agreements between the House, Senate and governor's office on a workers' compensation overhaul and an eight-year infrastructure improvement plan.

The income tax cut has been a top priority of Gov. Mary Fallin, while Senate President Pro Tem Brian Bingman has championed workers' compensation changes and House Speaker T.W. Shannon has pushed for the multi-year plan to prioritize renovations to state buildings and other infrastructure.

None would confirm details about the tax agreement, but Shannon said the three expected to make an announcement Tuesday or Wednesday.

"I think these are three of the main issues that we all have on our priority lists from the House caucus, the Senate caucus and the governor," Shannon, R-Lawton, said Thursday. "We just thought it made sense to make it an announcement altogether."

How deeply to reduce the income tax and when the cut would take effect have been key issues in negotiations.

Fallin and Shannon supported a bill to cut the top rate from 5.25 percent to 5 percent, effective Jan. 1, but that was replaced with a Senate proposal to cut the rate to 4.95 percent — but not until 2015. Shannon and Fallin both have agreed to delay the cut in exchange rate lower than 4.95 percent, while another idea that was being discussed was whether to phase in the tax cut over two years.

"The governor would accept a delay in the tax cut if it meant a larger overall cut in the following years," Fallin spokesman Alex Weintz said, though he also declined to release any details about a possible agreement.

"Until we can get consensus on everything and get the documents prepared, then I'm reluctant to go out there and start talking about that," Bingman said. "If something goes wrong in one part, it could affect something else."

New details on the plan to overhaul Oklahoma's workers' compensation system and switch to an administrative system are expected to be unveiled Monday in the House Calendar Committee. The proposal also will include an "Oklahoma option" that will allow companies to provide their own workers' compensation coverage if they meet certain required standards.

Shannon's eight-year infrastructure proposal, which is pending in the Senate, calls for a consolidation of the oversight of state properties and buildings by the Office of Management and Enterprise Services, and the development of a prioritized plan for improvements and renovations. Shannon has said his "pay-as-you-go" plan is a priority because House Republicans have been hesitant to support a bond issue to pay for infrastructure improvements.


Sean Murphy can be reached at www.twitter.com/apseanmurphy