Friday, November 27, 2020

Week of Feb. 6

In This Issue…

Step Up Oklahoma – For or against this proposal? Let your reps know now
Free webinar on evaluating S Corporation Status coming up
New OBA.com, MyOBA portal unveiled
OBA Bankers’ Night Out programs ready for spring
OBA education corner …

Step Up Oklahoma – For or against this proposal? Let your reps know now

As you’ve undoubtedly heard or read about recently, a small group of leading business and civic leaders have developed a plan they say will help the state move forward and begin the process of “reforming” state government. Working together, these leaders developed a package of proposed changes in a number of areas, including a long-overdue $5,000 raise for teachers.

The vote, to be successful, will have to have 76 members of the House of Representatives vote “aye.” This package of proposed changes necessarily includes enacting four specific tax changes to address the revenue needed to implement the plan:

  • Cigarette taxes will be increased and will include sales of little cigars, chewing tobacco and e-cigarettes).
  • Personal income taxes will be impacted by capping itemized deductions and changing rates in a number of different ways (55 percent of filers will see a reduction or no change in tax liability, according to the website).
  • Most of the increase in revenue comes from increased taxes on the highest income filers.
  • Gross Production Taxes will be increased by two percent on all wells, to be increased to four percent on existing wells, and all future wells will begin at four percent for the first 36 months and move to seven percent thereafter.
  • Diesel and gasoline taxes are increased by 6 cents per gallon.

Taken together, these tax changes will raise about 94 percent of the revenue needed under the plan. The rest comes from changing the gaming tax rates and creating what’s called a renewables generation tax.

You can see the plan’s details by clicking here: http://stepupoklahoma.com/.

Other changes will also be necessary under the Step Up Plan, including changing the “supermajority” threshold required to enact a tax increase from 75 percent to 60 percent.

The list of supporters and supporting organizations is growing daily, and includes a good number of bankers from banks both large and small. But not everyone agrees this proposal is a good one. Here are the concerns expressed by many of those who oppose the Step-Up Plan:

  • Primarily, the plan does not really address the changes in the state’s government structures that are necessary. In fact, the Step Up plan reinforces the existing system by focusing on how much the government spends, rather than how it spends it.
  • The Plan continues the historical approach of increasing taxes and throwing money at our state’s problems. This approach does not address the causes of understanding why what we’re doing now isn’t working.
  • Simply spending more money without a massive reorganization and restructuring of both state and local governments as well as the state’s education system assumes what we’re doing now is working. It should be apparent to everyone that this is simply not true.
  • There is a great deal of inefficiency, waste and abuse in our state’s current governance structure at both the state and local levels. This includes the outdated structure of the state’s education system.
  • According to one report, more than 13 percent of Oklahomans’ personal income goes to pay for state and local government. Yet per capita spending comparing Oklahoma and Texas shows that Texas’s spending is less per capita that it is in Oklahoma, yet Texas teachers are paid much better than ours.
  • Some of the questions to ask yourself:
    • Oklahoma is prosperous often in spite of our inefficient government.
    • 60 percent of Oklahoma births are covered by Medicaid, and 64 percent of public school students claim to be economically disadvantaged – but in Oklahoma only 17 percent of the population earns less than the poverty rate. How can that be true?
    • Rural health care suffers while big-city hospitals flourish. Why is that and what can be done?
    • Many local school districts spend money on football press boxes, complain because they don’t have money to buy textbooks. Does that make sense?
    • There is considerable research – by the 1889 Institute, for example – that has suggested ways our state and local governments could be more effective without spending more money. Why not start there rather than raising taxes?

At the end of the day, it comes down to whether the proponents can carry the day and persuade members on both sides of the aisle to support the various components of the Step Up plan. The best thing bankers can do is engage in the process and let your representative and your senator know what you think and how you want them to vote. That’s the point.

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Free webinar on evaluating S Corporation Status coming up

There are 143 Oklahoma banks that have elected Subchapter S status under the Internal Revenue Code. The recent tax bill that was passed brings with some very significant changes to how banks are going to be taxed under the new system.

The American Bankers Association and the Subchapter “S” Association have teamed up to provide your bank with a FREE webinar that’s scheduled for “Valentine’s Day,” Feb. 14.

Click here to register.

The most significant changes in the bill deal with the tax rate reduction for C corporations. It also introduces a new deduction from qualified business income for pass through entities, including banks that have elected S corporation status. How will these changes impact your bank’s operation? What do you need to be doing to get ready for these changes?

This FREE webinar is cosponsored by ABA and the S Bank Association. Experts from Crowe Horwath, Kennedy & Sutherland and the ABA will provide an overview of the changes in the new law, review operating considerations in considering “S” versus “C” status and review sample financial analytics that might be considered in a bank’s evaluation.

The webinar is open to all banks, we’re told, not just ABA members. It could very well be worth your time to have someone in the bank sign up for this program.

The 90-minute webinar is scheduled for 1-2:30 p.m. on Wednesday, Feb. 14.

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New OBA.com, MyOBA portal unveiled

Make sure you check out the new OBA.com website and MyOBA portal later this week!

A simple click to www.OBA.com will bring you to our redesigned website. This website should still be easily navigable, finding things on it will be much easier for visitors.

An important function through the website is the portal on the front page to MyOBA for all our bankers to log in and update pertinent information while also being able to register for upcoming events or order products.

There, obviously, will be some kinks to work through over the next few days, so we appreciate your patience. But if you have any questions at all, feel free to drop us a line!

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OBA Bankers’ Night Out programs ready for spring

The dates for the OBA Bankers’ Night Out programs have been finalized. Mark your calendar for the date of the program that’s in your area of the state and plan to attend. Bring your coworkers with you so that everyone can be up to speed on the most recent developments affecting their job.

As in the past, the schedule for each of these meetings is:

5:30 p.m. – Drinks
6:15 p.m. – Program
7 p.m. – Dinner

PRE-REGISTRATION IS REQUIRED. The cost is $40 per person. Click here for a registration form.

Locations and dates for this year’s events are:

  • Krebs, March 13.
  • Lawton, March 15.
  • Enid, March 27.
  • Oklahoma City, March 28.
  • Tulsa, April 3.
  • Guymon, April 19.

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OBA education corner …

Live programs are back in full force in the education department as the holidays are behind us! Check out the following:

Editor’s note: Links to online registration and more information for most live seminars are currently unavailable as the OBA switches to a new website and database over the next week. Please feel free to contact the education department with any questions or to register for the below programs.

  • Consumer Real Estate Loans, Feb. 12, webinar — This webinar will help you tame those scary real-estate-loan problems and will be particularly helpful to bankers wanting to offer consumer real-estate loans for the first time in several years.
  • Regulation CC – Check Holds, Feb. 15, webinar — Can we place a hold on a cashier’s check? How many days can we hold checks on a new account? Does this apply to business accounts? Do we have to give the hold while the customer is there or can we mail it later? These questions will all be addressed in this informative and easy-to-follow program for the frontline.
  • Compliance Rules for Commercial Loan Secured by Real Estate, Feb. 15, webinar — If your financial institution is required to report under the new rules, are you in compliance for covered business purpose applications?
  • Mapping Multi-Tiered Business Accounts, Feb. 15, webinar — We will diagram and map out several complicated business structures and learn how to get the proper documentation, resolutions and beneficial ownership in these unique entities.
  • ACH Rules Update, Feb. 21, webinar — Attend this webinar to make sure that you are not only compliant with the ACH Rules, but understand the new opportunities that are available with the changes.
  • Ransomware and Cyber Extortion, Feb. 22, webinar — Join us to recap the statistics related to ransomware and learn how to prepare for this growing threat.
  • Dealing with Appraisals: Regulations and Requirements, Feb. 23, webinar — Learn in-depth details of the appraisal and valuation process, from both the lender and appraiser side of the game.
  • Implementing the Updated TRID RulesFeb. 27 – TulsaFeb. 28 – Oklahoma City — This one-day program reviews the 2017 amendments and explains how the amendments impact the existing rule.
  • Basic Tax Return, March 1 – Tulsa; March 2 – Oklahoma City — Attend this proactive seminar and gain an
    understanding of the often complex and confusing topic of taxes!
  • 2018 OBA Commercial Lending School, March 4-9, Oklahoma City — This school is an intensive, week-long functional school designed for bankers with a basic understanding of credit and financial analysis.
  • Call Report Seminar, March 13, Oklahoma City — Anyone responsible for preparing, auditing or signing the call report will find the program valuable.

Also, make sure to save the date for the 2018 Community Bankers Leadership & Senior Management Conference, set this year for April 8-10 in Las Vegas. If you work for a community bank or if you’re looking for ways to improve your bank’s performance, then this event is for you! Call the OBA for more information.

Finally, a quick side note: Junior Achievement is looking for volunteers for its JA Finance Park in late February and early March. This is where students will make the distinction between abilities, aptitudes, interests, work preferences and values. They will explore various sources of income, including salaries and wages, interest and business profit. For more information, click here.

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