Who is the Oklahoma Turnpike Authority - Part 5
How do you stop a bad guy who has all the money and breaks the law with impunity?
The story continues with an unethical judicial system, an intellectually honest Senator and an Attorney General who believes the Constitution should be enforced…. Make sure to read Parts 1, 2, 3 and 4 to the story first!
Goliath has deep pockets
The OTA isn’t accustomed to losing. On January 11, 2023, the OTA filed an Appeal in the Open Meetings Act case and asked that the appeal go straight to the Supreme Court (Case No. 120,981) where they have found unusually consistent favor with a particular Judge over the past decade. On May 31, 2023, the Court reversed the District Court Decision in a split 5-3 opinion and gave summary judgment to the OTA, saying they did not, in fact, violate the Open Meeting Act. The dissent by Rowe, Gurich and Kuehn was telling:
The three Supreme Court Judges exhibiting the intellectual honesty to dissent, also had the following to say about the OTA’s consistent misuse of the Supreme Court’s original jurisdiction clause in the Turnpike Enabling Act (Title 69, Section 1718).
On August 1, 2023, the Supreme Court levied another split decision 6-3; this time in the bond validation case where the Supreme Court claimed original jurisdiction to hear the District Court Case alleging lack of legislative authorization in the Turnpike Enabling Act (Title 69, Section 1705). The dissent from three Supreme Court Justices was scathing.
On September 20, 2023, the plaintiffs seeking qui tam relief made a voluntary motion to dismiss with prejudice concerning the claims related to the Open Meeting Act (OMA) Violation summary judgment reversal.
The OTA again made an application to the Council of Bond Oversight (COBO) stating that they had fulfilled all the terms of their conditional revenue bond sale approval. This application was heard on September 11, 2023 as shown in the COBO agenda. The COBO voted to approve the request as can be seen in the memo below.
In October of 2023, the Oklahoma Turnpike Authority (OTA) sold their first $500 Million in bonds, netting only $335 Million due to paying capitalization fees, an unfavorable interest rate (~5.17%) and having to use $80 million to repay their general fund to monies they paid to engineering design firms to fast-track the design on the contested routes. Word on the street is they are using that $335 Million to first finish their over-budget Driving Forward Program projects including work on the Turner and Kilpatrick. Director Gatz has also announced that the $5Billion ACCESS program is more like a $7Billion dollar program now and that they will attempt to sell $500 Million more revenue bonds in June (after the legislative session) or November (after the election) of 2024 and then $1Billion every other year. They have announced internally that they plan is to raise tolls 15% and then 6% every other year until 2045 since they cannot service the debt they will be in with current revenues even growing a couple percent a year. The toll increase would be a one time action by the board so the every other year increases would take effect automatically. From my math, these increases in the tolls by 2045 would essentially double today's tolls.
The Fight Is Far from Over
While all of the legal battles were waging, the Oklahomans for Responsible Transportation (ORT) were hard at work in the legislature. During the 2023 Legislative Session, ORT were successful in bringing HB 2263 from conception to new law: an incredible feat. HB2263 divided the executive powers of appointment to the Oklahoma Turnpike Authority (OTA) Board to both the Senate and House and required financial conflict of interest disclosures of all board members.
HB2263 was born out of the ORT legislative interim studies held in Fall of 2022 and subsequently issued policy statement, asserting, in part, that the “OTA Board membership should be appointed by the House and Senate, not just the Governor.” This bill passed almost unanimously out of the Oklahoma State House and Senate, but was vetoed by Governor Stitt. Thankfully, on the last day of the 2023 session, both houses in the legislature almost unanimously voted to override the Governor’s veto.
On November 1, 2023, House Bill 2263 (HB2263) became law.
In response to this new law, the OTA sued the legislature in January of 2024 with a lawsuit (CV-2024-72) arguing constitutionality. The outcome of this case is still pending.
In addition to the lawsuit questioning the constitutionality of the new law, Senator Haste, Senate Transportation Committee Chairman, sent a request for an official Attorney General Opinion asking if the changes enacted in HB2263 violate the Oklahoma Constitution.
On Wednesday, February 28, 2024, the Oklahoma Attorney General (OAG) Gentner Drummond published an opinion detailing why House Bill (HB) 2263 amending Title 69 Section 1703 is constitutional and does not violate the separation of powers provision in the Oklahoma Constitution.
No Individual Can Simultaneously Serve in Multiple State Offices
While all this nonsense was going on with the OTA fighting the new law changing the way in which the Oklahoma Turnpike Authority Board was appointed, ORT was also questioning the legality of the same individual simultaneously serving in three state offices: Oklahoma Department of Transportation, the Oklahoma Turnpike Authority and the Secretary of Transportation.
Table 1. Appointments to ODOT, OTA and SoT over time.
In the Fall 2022 ORT Legislative Studies it was discussed that it was not good policy or proper governance (and likely illegal) for the same individual to serve in multiple state transportation roles handling huge amounts of tax payer and bond holder monies. In fact, in the three times since 1995 that one individual served in all three roles, the consolidation of power was bad for the Oklahoma Citizen (more on that in another post).
Senator Mary Boren, District 16, acted on the ORT policy recommendations and requested an official Attorney General Opinion in October of 2023 on the legality of one person holding multiple state offices recognizing it as the sole avenue to mandate the necessary separation of powers.
On Wednesday, February 28, 2024, the Oklahoma Attorney General (OAG) published an opinion that held it is illegal for an individual to serve in three state “offices,” and Mr. Tim Gatz must resign or be removed from two “offices.” In addition, AG Drummond stated that when a state officer takes on the duties of a second office in violation of the dual office holding prohibition, they vacate the first office, however, even if a person vacates an office by assuming a second (or third) office, the official actions of the officer are valid, binding and enforceable.
In response to this opinion, effective February 28, 2024, Mr. Gatz resigned as Sec. of Transportation and as Executive Director of the OTA and was reappointed by the Governor as Director of the Oklahoma Department of Transportation (ODOT). ODOT/OTA Statement
The ORT nonprofit should find reassurances in the effectiveness of their advocacy, demonstrated by the published opinion. Citizen advocacy can work well when elected officials with intellectual honesty exist.
More information can be found in the February 28, 2024 OAG Press Release.
INVESTIGATIVE AUDIT AND LOFT INVESTIGATION
Oh, but there is more! In March 2023, Oklahoma Attorney General Drummond requested Cindy Byrd, Oklahoma State Auditor and Inspector, to conduct an investigative audit of the OTA. This request came after OAG Drummond had many conversations with members of ORT, legislators and state employees who expressed concern about OTA’s financial conduct. Almost one year later, the audit is still pending.
In addition to the pending audit, the Legislative Office of Fiscal Transparency (LOFT) launched an investigation into the OTA to examine the cost/revenue per tollway, average time to retire toll bonds, evaluate bond refunding and its impact on bond retirement and the feasibility of toll roads transitioning to no-toll State highways.
As you can tell, the history of this agency is long and sordid and the Citizen fight exceptionally important. I will delve into some of these topics in much more detail as time moves on. I hope you will consider joining the fight.
Are you interested in learning more and helping hold a rogue "state instrumentality” accountable to the people? In response to the Oklahoma Turnpike Authority’s legacy of unethical and downright illegal business practices, two Oklahoma non-profits were created to protect Oklahoma Citizens’ private property rights, educate the state on proper transportation planning policy and enlighten lawmakers and other elected officials about the poor business and financial practices that the OTA continues to engage in. PIKE OFF OTA (501 c4) and Oklahomans for Responsible Transportation, Foundation (501 c3) are leading the charge in legal injunctive avenues and legislative reform and they could use your help. They are trying to dismantle a corrupt Goliath within our state and are doing a great job. Be part of the solution!
www.pikeoffota.com
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