Despite a tough budget outlook, the 2010 legislative session produced some very good legislation for Oklahoma business – up until the vetoes came. The State Chamber until then worked with our allies to pass legislation that blocked a historic tax increase, enabled workers’ compensation reforms and enacted education reforms. These bills will help Oklahoma’s economy grow. However, a massive tax increase on paid health care claims and a two-year moratorium on more than 30 economic development tax incentives will severely impact the jobs outlook in Oklahoma.

And that’s when the governor’s veto pen came out.

His post-session vetoes will have long-term negative impacts. His veto of the creation of a trust fund board for medical liability indemnity threatens lawsuit reforms passed last year. He also vetoed two major health care reforms that were designed to save taxpayers and policyholders substantial dollars. Legislation that would have encouraged development of wireless telephone systems in the state was vetoed, as was a sensible rewrite of Oklahoma’s employment discrimination laws. All of these bills would have helped create jobs in Oklahoma.

A review of the session shows the good and the bad of a tough year with tough choices.

The good

Blocking a historic tax increase on business: Last year, Oklahoma’s Supreme Court ruled that locally assessed individuals and businesses must pay property taxes on their intangible personal property – items such as customer lists, signage, patents, trademarks, licenses, software and contracts. We estimate blocking this tax increase saved $100 million.

Workers’ compensation reform: A package of four bills was passed that reforms our Workers’ Compensation Court, requires Senate confirmation of all such judges and tightens up definitions. This should save $60 million.

Small Employer Quality Jobs Incentive Act amendments: A key economic development issue of The State Chamber, this legislation allows for a 24-month ramp-up for qualifying businesses to reach a required new employee base and changes the average county wage requirement to reflect 125 percent of the average county wage of small employers in the county.

Education reform: Reforms passed allow school districts to develop a deregulation plan creating more autonomy in the development of best education practices, create a teacher performance pay plan and expand the creation of charter schools. Additional reforms allow school districts to develop a teacher and administrator evaluation and leadership training program, allow online courses as a means for fulfilling education requirements and create a scholarship program for developmentally disabled children.

The bad

New tax imposed on health care claims: A new 1-percent tax will be imposed on all paid health claims. This tax is expected to be passed through to policyholders and result in a 1-percent increase in all health care premiums. It also covers self-insureds who pay their own health care claims. We estimate the cost to Oklahoma employers at $78 million.

Moratorium on tax credits: A two-year moratorium was imposed on more than 30 tax credits used by businesses to create jobs. While the estimated cost to Oklahoma employers is $50 million, a trailer bill allows for accrual of three of these credits.

Fred Morgan is president and CEO of The State Chamber of Oklahoma.