State lawmakers can be fired for late taxes

Sunday, February 10th 2008, 1:11 pm
By: News 9

Associated Press 

Failing to file state income taxes has caused political headaches for some lawmakers, but for many state employees, the consequence has been especially dire: they've been fired.

A 2003 law directs agency heads to fire state workers who do not resolve their income tax problems. The law requires the Oklahoma Tax Commission to notify agencies that have employees who have not filed their state returns.

"We don't keep track of terminations, but there have been numerous people fired due to this law," said Paula Ross, an Oklahoma Tax Commission spokeswoman.

Ross said she was aware of the firings because agency officials have called the Tax Commission to report the employee terminations.

Oklahomans who face an April 15 tax-filing deadline should be aware that failure to file is a criminal offense under state law, a misdemeanor punishable by up to a year in jail and a $5,000 fine. 

Offenders rarely have been prosecuted, however.

"I know people have been prosecuted, but the cases have been handled by the district attorneys and I don't have numbers on that," Ross said.

In recent years, she said the Tax Commission has exclusively used a civil procedure to compel reluctant taxpayers to resolve their tax problems. The Associated Press asked the Tax Commission to outline its procedures after four state House members got letters for failing to file their returns.

One of them is Rep. Lance Cargill, R-Harrah, who stepped down as House speaker soon after published reports said he did not file income tax returns for 2005 and 2006. Cargill, who voted for the law to require the firing of state workers who did not file their returns, also was late paying property taxes on his law firm for six years.

He and the other lawmakers have apologized for the tax-filing lapses and say they have taken care of the problem. 

Ross said people who fail to file income tax returns and do not respond to collection efforts could still be charged with a crime as "a last resort."

She said over the last couple of years, the Tax Commission has changed its focus from criminal prosecution to sending out "Notice to File Return" letters to taxpayers and seeking district court orders directing taxpayers to comply.

"In cases where the defendant fails to produce the returns after being ordered to do so, the OTC pursues citations of contempt for failure to comply with the court order. This procedure has resulted in the filing of returns in all but a few instances," Ross said.

"Our main goal is to have compliance with the tax laws and to make it fair and equitable for those who properly file. This measure has worked better and is more cost effective for the Tax Commission and the taxpayer."

She said the "vast majority of people file their taxes on time." How many state employees have been fired over tax problems is not known.  Ross said her agency does not keep tabs on that; neither does the Office of Personnel Management.

Patti Omerod, the human resources program manager at the Oklahoma Merit Protection Commission, said no employees have filed appeals of their dismissals because of the tax issue in the two years she has been on the job.

For Cargill, disclosure of his tax problems was the latest in a series of episodes that led to discord in the Republican House caucus.

The former speaker has been the subject of an ethics inquiry into his fundraising activities. One of the issues was how checks made out to the state Republican Party wound up in an Oklahoma County fund.

Soon after taking office early in 2007, Cargill drew criticism after he summoned lobbyists to one-on-one meetings at a political consultant's office to seek contributions to Republican political action committees and for the speaker's "100 Ideas Initiative."

Questions have been raised about other issues, including the expenditure of more than $1.6 million during the past two years for furniture and related equipment for House members.