OKLAHOMA CITY - Two of the state's largest oil and gas groups said Friday they are willing to compromise for the sake of the budget.
The Oklahoma Independent Petroleum Association and the Oklahoma Oil and Gas Association held a press conference to announce their plan to prevent what other industry leaders called "draconian cuts."
"We think it’s a good compromise for Oklahoma and it’s the right thing to do," said OKOGA Executive Director Chad Warmington. "I think that’s what we’re calling for is for cooler heads to prevail and compromise."
The oil industry is willing to raise what's known as the Gross Production Tax -- levied on new wells for 36 months -- from two percent to three percent.
It's also willing to slash so-called "rebates" on wells that are restarted after going dormant.
The proposal is still below what democrats have been calling for. House Minority Leader Scott Inman has said his caucus will not accept a gross production tax rate below five percent. The oil industry, however, says increasing the tax that much is risky.
"We want to keep Oklahoma competitive," said OIPA Vice President Tim Wigley. "We’re the number one target of oil and gas investment across the country and we fare better than most other states, all other states in this downturn. So when you compare state to state and so forth, that’s how we fared better, because we had a drilling incentive to drill in Oklahoma."
Warmington agreed, adding local business is also at risk if the rate is raised too high.
"Because at the end of the day, what drives Oklahoma’s economy is rigs running," he said. "It’s the mom and pop restaurants, it’s the dry cleaners, it’s the real estate agents, it’s Eischen’s. It’s places you know well that do well when we’re doing well."
Democrats have argued the oil industry doesn't pay its fair share in taxes and notes that many wells are already taxed at seven percent, according to the Oklahoma Tax Commission.
Crystal Davis, of Bethany, took the day off work to hold a sign of protest during the press conference.
"Seeing what’s going on and seeing all the political football just being kicked back and forth is just absolutely pissing me off," she said. "I believe 5 percent [gross production tax] is the only acceptable amount that we can come to the table with and I believe it must be from day one. We must represent the people of Oklahoma, not the oil and gas industry. We need to step up and do what’s right for our state to save our schools, save our hospitals, save our mental health and to help the citizens of Oklahoma."
Standing with representatives from the state Chamber of Commerce and the medical industry, the OIPA's Tim Wigley said oil does a lot for the state.
"We account for nearly 25 percent of all tax dollars in this state," he said. "It pays for schools, it pays for teachers."
Budget negotiations continued for leadership behind closed doors.
Lawmakers will almost certainly meet over the weekend as they attempt to iron things out.