PM attorneys create “practical” guide to commercial real estate leasing

Phillips Murrah attorneys merged their expertise to curate a commercial real estate leasing legal guide for Thomson Reuters’ Practical Law resource.

Thomson Reuters Practical Law provides guidance across many practice areas with hundreds of editors monitoring each subject to make day-to-day updates as legal viewpoints shift. Directors Sally A. Hasenfratz and Joshua L. Edwards and Attorneys Jennifer Ivester Berry and Erica K. Halley contributed to organizing the August 5, 2020 update for Real Estate Leasing for Oklahoma.

“I enjoyed spending time taking an earnest look at the various layers of my real estate and leasing practice to create a user-friendly roadmap on the basics in the Oklahoma market,” Halley said. “Q&As like this and similar materials made available by Thompson Reuters are great resources for out-of-state attorneys and, particularly, local attorneys who may be handling a matter outside of their usual field.”

thomson reuters practical law

Read more on Phillips Murrah’s Real Estate Leasing guide for Oklahoma from Thomson Reuters here.

Federal Medicaid match matters to state’s healthcare providers

Introducing Becky-Pasternik-Ikard

Rebecca “Becky” Pasternik-Ikard is a lawyer, a nurse and a Medicaid program director who brings decades of experience to assist Phillips Murrah healthcare clients in copy with reimbursement, including negotiating payments, audits and appeals, and other regulatory issues related to governmental payments of providers.

In this article, Oklahoma City Attorney Rebecca Pasternik-Ikard answers questions about state and federal government’s role in funding Oklahoma’s Medicaid program.

What is the Federal Medical Assistance Percentage (FMAP)?

The Federal Medical Assistance Percentage is the federal government’s share of the expenditures for medical services and administrative costs for a state Medicaid program and is often called the “federal match.”

Why does it matter to Oklahoma’s healthcare providers?

FMAP matters because each state’s Medicaid program is funded jointly by state and federal dollars. Generally, states receiving a higher FMAP for medical services need fewer state dollars. But a state must have state dollars to leverage federal matching dollars. On a quarterly basis, a state submits to the federal government its Medicaid expenditures paid by state dollars seeking to “draw down” the federal matching dollars.

How often does the FMAP change?

The FMAP for medical services for all states is calculated annually by U.S. Department of Health and Human Services (HHS), based on a formula in the Social Security Act, and is effective from Oct. 1 through Sept. 30 of each year. The FMAP varies from state to state; it can be no lower than 50% and no higher than 83%. So, for every $1 states spend on Medicaid, states can “draw down” at least $1 from the federal government. However, the FMAP for a state’s Medicaid administrative costs is fixed, generally at 50% FMAP. States do receive enhanced FMAP for certain populations, services and a variety of administrative functions.

How does the FMAP specifically impact physicians, hospitals and other healthcare providers?

Fluctuations in the FMAP for medical services can have significant impact on all healthcare providers. Significant increases often allow a state to restore, increase or add benefits compensable under the Medicaid program, as well as adjust upward the rates paid to providers. Conversely, depending on a state’s ability to offset the loss of federal funds, a decrease in the FMAP can trigger the elimination or reduction in certain benefits provided to Medicaid enrollees, as well as a decrease in provider rates.

How is the FMAP for medical services calculated?

The FMAP is based on a rolling three-year average of the per capita income of each state as compared to the national average per capita income. However, there is a lag in the data used. For instance, for FY 2019 (effective Oct 1, 2018-Sept. 30, 2019) the FMAP calculation for states was based on state per capita personal income data for 2014, 2015 and 2016. Generally, what this means is that for states with lower per capita incomes relative to the national average, the federal government contributes more to the Medicaid program. Conversely, the federal government contributes less to the Medicaid program in those states with higher per capita incomes. However, the formula is not responsive quickly when a state experiences an economic downturn.

How does the FMAP work in Oklahoma?

With the exception of the FY 2014 FMAP of 64.02%, Oklahoma’s FMAP declined overall from 64.00% in FY 2013 to 58.57% in FY 2018. Oklahoma experienced the largest cumulative FMAP decrease in the nation over this period. This significant loss of federal dollars prompted the Oklahoma Health Care Authority (OHCA) to implement administrative and operational strategies to continue to operate the Medicaid program, resulting in physician and other provider rate reductions of 7.75% in July 2015 and 3% in January 2016. From FY 2018 to FY 2019, Oklahoma had the greatest FMAP increase of any state of 3.81%, from 58.57% ($1.43 in federal dollars for every state dollar spent in medical services) to 62.38% ($1.66 in federal dollars for every state dollar spent in medical services). This influx of federal matching dollars and OHCA’s management of its administrative and program budgets allowed OHCA to restore the last provider rate reduction of 3%. From FY 2019 to FY 2020, Oklahoma experienced another significant FMAP increase of 3.64% from 62.38% ($1.66 in federal dollars for every state dollar spent in medical services) to 66.02% ($1.94 in federal dollars for every state dollar spent in medical services). Once again, provider rates were increased. The good news is that, due to Oklahoma’s experience with shifting FMAPs, a Rate Preservation Fund of $29.4 million was created this year, to help offset future FMAP decreases and mitigate potential provider rate reductions.

Rebecca Pasternik-Ikard is an attorney at Phillips Murrah.

Phillips Murrah named among 2020 Best Law Firms in 45 practice areas

Phillips Murrah is proud to announce that our law firm has been recognized by U.S. News & World Report’s 2020 “Best Law Firms” for professional excellence for the Oklahoma City Metropolitan Area and, for the first time, the Dallas/Fort Worth area in the following practice areas:

Oklahoma City

Tier 1

  • Administrative / Regulatory Law
  • Banking and Finance Law
  • Bankruptcy and Creditor Debtor Rights / Insolvency and Reorganization Law
  • Business Organizations (including LLCs and Partnerships)
  • Commercial Litigation
  • Commercial Transactions / UCC Law
  • Corporate Law
  • Energy Law
  • Energy Regulatory Law
  • Government Relations Practice
  • Insurance Law
  • Litigation – Bankruptcy
  • Litigation – Real Estate
  • Litigation – Tax
  • Natural Resources Law
  • Oil & Gas Law
  • Product Liability Litigation – Defendants
  • Real Estate Law
  • Trusts & Estates Law

Tier 2

  • Construction Law
  • Employment Law – Management
  • Health Care Law
  • Land Use & Zoning Law
  • Litigation – Banking & Finance
  • Litigation – Labor & Employment
  • Litigation – Land Use & Zoning
  • Mergers & Acquisitions Law
  • Public Finance Law
  • Securities Regulation
  • Tax Law
  • Workers’ Compensation Law – Employers

Tier 3

  • Bet-the-Company Litigation
  • Environmental Law
  • Family Law
  • Labor Law – Management
  • Litigation – Antitrust
  • Litigation – ERISA
  • Litigation – Trusts & Estates
  • Mass Tort Litigation / Class Actions – Defendants
  • Medical Malpractice Law – Defendants
  • Personal Injury Litigation – Defendants
  • Securities / Capital Markets Law
  • Technology Law
  • Venture Capital Law

Dallas/Fort Worth

Tier 3

  • Bankruptcy and Creditor Debtor Rights / Insolvency and Reorganization Law


To be eligible for a ranking, a law firm must have a lawyer listed in The Best Lawyers in America, which recognizes the top four percent of practicing attorneys in the United States.

Earlier in the year, Phillips Murrah announced that 48 of our attorneys are recognized by Best Lawyers in America for 2020.

Firms included in the 2020 “Best Law Firms” list are recognized for professional excellence, quality law practice and breadth of legal expertise. The “Best Law Firms” rankings are based on a combination of client feedback, information provided on the Law Firm Survey and the Law Firm Leaders Survey and Best Lawyers peer-review.

Newton presents on preemptive business practices for ASA-OK

ASA LogoPhillips Murrah Attorney Samuel D. Newton gave the last presentation for a Fall educational series on Nov. 2 for members of the American Subcontractors Association of Oklahoma.

Newton’s presentation was entitled “Protect and Preserve: Considerations and Implications of Business Practices on your Company’s Future” and follows presentations given by Attorneys A. Michelle Campney and David A. Walls in September and October, respectively.

“In the discussion, we covered maintaining corporate best practices to preserve the corporate shield, non-disclosure and confidentiality agreements, discussed the implications of the Oklahoma Uniform Trade Secrets Act and how it works with confidentiality and non-disclosure agreements and how they all apply to protecting your business,” Newton said. “I switched to discussion of preserving businesses either through succession planning or selling the business.

“With succession planning, I discussed the importance of seeing the truth of the situation and not the idea (ie, who really is most apt to take over your business) and how to implement such changes, like through a buy-sell agreement or the organizational documents. I then gave a basic overview of a sale and the initial documents owners may be confronted with (letters of intent, confidentiality agreements) as well as the importance of preparing for due diligence.”

Newton, Campney and Walls will continue the series and each give presentations to ASA-OK in the Spring.

For more information about ASA, visit their website here.

Phillips Murrah named among 2019 Best Law Firms in 39 practice areas

Phillips Murrah is proud to announce that our law firm has been recognized by U.S. News & World Report’s 2019 “Best Law Firms” for professional excellence for the Oklahoma City Metropolitan Area in the following practice areas:

Tier 1

  • Administrative / Regulatory Law
  • Banking and Finance Law
  • Business Organizations (including LLCs and Partnerships)
  • Commercial Litigation
  • Commercial Transactions / UCC Law
  • Corporate Law
  • Energy Law
  • Energy Regulatory Law
  • Government Relations Practice
  • Insurance Law
  • Land Use & Zoning Law
  • Litigation – Banking & Finance
  • Litigation – Bankruptcy
  • Litigation – Land Use & Zoning
  • Litigation – Real Estate
  • Litigation – Tax
  • Natural Resources Law
  • Product Liability Litigation – Defendants
  • Real Estate Law
  • Trusts & Estates Law

Tier 2

  • Construction Law
  • Health Care Law
  • Litigation – Antitrust
  • Mergers & Acquisitions Law
  • Public Finance Law
  • Securities Regulation
  • Tax Law
  • Workers’ Compensation Law – Employers

Tier 3

  • Bankruptcy and Creditor Debtor Rights / Insolvency and Reorganization Law
  • Environmental Law
  • Family Law
  • Litigation – ERISA
  • Litigation – Trusts & Estates
  • Mass Tort Litigation / Class Actions – Defendants
  • Medical Malpractice Law – Defendants
  • Oil & Gas Law
  • Personal Injury Litigation – Defendants
  • Securities / Capital Markets Law
  • Venture Capital Law

This list is for the Oklahoma City Metropolitan area. To be eligible for a ranking, a law firm must have a lawyer listed in The Best Lawyers in America, which recognizes the top four percent of practicing attorneys in the United States.

Earlier in the year, Phillips Murrah announced that 44 of our attorneys are recognized by Best Lawyers in America for 2019.

Firms included in the 2019 “Best Law Firms” list are recognized for professional excellence, quality law practice and breadth of legal expertise. The “Best Law Firms” rankings are based on a combination of client feedback, information provided on the Law Firm Survey and the Law Firm Leaders Survey and Best Lawyers peer-review.

Firm selects Employee of the Month for September 2018

Tifany Manning

Tifany Manning

Tifany Manning, Legal Assistant, is Phillips Murrah’s Employee of the Month for September 2018.

“Wow, it’s such a privilege to be chosen as Employee of the Month,” she said. “My bosses and co-worker’s are the BEST around!  I love my job and thankful I get to work for such a great firm.”

The Employee of the Month is selected anonymously by Phillips Murrah staff on merits of teamwork and overall contributions to the Firm.

“It has been a pleasure and honor to work with Tifany,” Director Jennifer L. Miller said. “No matter the task, Tifany always has a positive and professional attitude. Her work ethic and dedication to excellence is immeasurable.

“Tifany is a valuable member of the Phillips Murrah team and the award is very much deserved.”

Starting this month, the Firm will begin making a donation to the winner’s charity of choice.

“I chose Cavett Kids Foundation as my charity,” Manning said. “Cavett Kids strives to help kids with severe and life threatening illnesses have some normalcy by attending camps, of which they have six different ones, and just be a kid doing kid things.

“I have volunteered several times and learn something from these sweet kiddos every time. I love their mission, their values and their motto.”

Phillips Murrah attorneys volunteer each year with the foundation’s Camp Cavett send-off.

To learn more about Cavett Kids Foundation and how you can get involved, visit their website here.

Journal Record and Oklahoman Best Places to Work of 2017

Phillips Murrah has been recognized as one of the Best Places to Work in Oklahoma in 2017 by The Journal Record and an Oklahoma Top Work Place by The Oklahoman/Energage three years in a row. Our Firm strives to recognize and reward our employees for excellence.

Phillips Murrah attorneys present for Construction Financial Management Association

Attorney David Walls addresses construction industry professionals at September's CFMA meeting.

Attorney David Walls addresses construction industry professionals at September’s CFMA meeting.

David A. Walls, Construction Law Attorney, and Byrona J. Maule, Phillips Murrah Director and Employment Law Attorney, addressed construction industry professionals at a September meeting for Construction Financial Management Association.

Walls presented an update regarding American Institute of Architect changes to standard form construction industry contracts. Maule followed, speaking on the impact of Oklahoma’s medical marijuana laws on employment law.

Maule’s presentation focused on drug and alcohol testing, policy impacts on drug and alcohol testing and anti-discrimination, and preemption issues under the Controlled Substance Act, the Drug Free Workplace Act and the Federal Motor Carrier Safety Act.

As a result, she said, testing procedures need to be updated or changes, policies will have to be updated, and training will be needed for managers.

For more information about the Oklahoma chapter of CFMA, please click here.

Phillips Murrah’s legal team welcomes tax attorney

Jessica Cory

Jessica N. Cory

Phillips Murrah law firm is proud to welcome Jessica N. Cory to our downtown Oklahoma City office.

Phillips Murrah welcomed Jessica to the Firm’s Tax Law Practice Group as an associate attorney.

In her practice, Jessica represents businesses and individuals in a wide range of matters, including general tax planning, business succession planning, and the structuring of complex transactions.

Jessica has advised clients regarding corporate and general business matters, including choice of entity, formation, tax-free reorganizations, acquisitions and dispositions, and tax planning.  She has particular experience working with flow-through entities, including disregarded entities, limited liability companies, partnerships, and S corporations.  Jessica has also successfully represented clients in disputes with the Internal Revenue Service.

Prior to entering private practice, Jessica gained valuable experience service as a judicial clerk for United States District Court Judge Robin Cauthron in the Western District of Oklahoma.  She then received her Masters of Law in Taxation at New York University School of Law and worked for a law firm in Houston, Texas before joining Phillips Murrah.  Jessica is licensed in both Oklahoma and Texas.

Jessica has written and presented on a variety of tax topics, including choice-of-entity in light of the 2017 tax reform, the tax implications of foreign ownership of real property, changes to the partnership audit procedures enacted in 2015, and defending against the trust fund recovery penalty.

Jessica grew up in Killeen, Texas but now lives in Oklahoma City, Oklahoma.  In her free time, she enjoys spending time with friends and family, traveling, and training for her next race.

Attorneys prepare educational presentations on construction law

ASA LogoPhillips Murrah Attorneys A. Michelle Campney, Samuel D. Newton, and David A. Walls explore facets of construction law as a part of an educational series for members of the American Subcontractors Association of Oklahoma.

The team has planned six presentations, three in the fall and three in the spring, with the first topic covering the “Do’s and Don’ts of Bidding” on Sept. 7. Subsequent presentations by Walls and Newton are planned for Oct. 5 and Nov. 2, respectively.

“In the past, we have spoken about different provisions in the typical construction contact,” Campney said. “The presentations are new material on different topics important to subcontractors and construction.”

For more information about ASA, visit their website here.

Public-Private Partnership in infrastructure: an alternative to federal funding

Efforts made this year to move forward with a federal infrastructure bill have stalled. Now, with the state budget strained and federal dollars unlikely, the legislature, counties, and municipalities will likely need to look at alternative methods to deliver needed infrastructure enhancements and repairs without additional tax funding. A public-private partnership (P3) in infrastructure development provides a viable alternative. Using a P3 structure, a state will turn over one of its essential services, such as highway construction, to a private developer.

When people think of P3s, they generally imagine large-scale infrastructure projects. However, bundling smaller projects has shown promise that allows benefits to flow to smaller projects or rural communities. For example, Pennsylvania awarded a multi-year contract for a developer to finance, design, construct, and maintain 558 bridges that otherwise would have had to wait until the budget constraints allowed for repair. P3s have also been used on other public works projects such as wastewater treatment centers, schools and hospitals.

In 2017, the Oklahoma Public and Private Facilities and Infrastructure Act was enacted, authorizing a governmental entity to enter into P3s. While the act appears to be more focused on utilizing the P3 scheme for non-highway infrastructure projects – it exempts the Oklahoma Department of Transportation and the Oklahoma Turnpike Authority – it does allow for ODOT and the OTA to utilize its general scheme for awarding road infrastructure projects. Most importantly, it provides a ready framework for identification and implementation by examining, among other factors, the project’s ability to improve public operational efficiencies, promote public safety or attract private investment in the state and minimize governmental liabilities.

However, P3s aren’t a panacea. One of the oft-cited concerns of using a public-private partnership in infrastructure is turning over an essential government service to a private corporation that isn’t subject to the same oversight and accountability standards as a public agency. This concern is addressed in the contractual documents surrounding the P3 project, with the government generally having significant oversight rights. The agency that would generally be responsible and the partnership committee established under the act will need to engage in significant analysis prior to deciding on a P3, and both the parties have to be able to work together in the spirit of the project with awareness as to its respective rights and responsibilities.


Gavel to Gavel appears in The Journal Record. This column was originally published in The Journal Record on August 2, 2018.

SQ 788 also opens path for new medical marijuana businesses

In this article, Director Jason M. Kreth discusses requirements and allowances for medical marijuana distributors and businesses since Oklahoma voters approved State Question 788.

Jason M. Kreth

Jason M. Kreth is a Director and a commercial litigator who represents financial institutions, handling matters such as foreclosures, bankruptcy and lender liability litigation. He also represents clients in a range of real property disputes.

Q: What type of new business opportunities exist now that SQ 788 has passed?

A: The approval of SQ 788 enacted a series of new statutes that take effect July 26. Aside from provisions related to the acquisition of a medical marijuana license for individual use, the statutes also provide a framework for the approval of new medical marijuana businesses. These businesses are: retailers or dispensaries of medical marijuana; commercial growers of medical marijuana; processors of medical marijuana into concentrated, edible or other forms; and medical marijuana researchers. In addition, the Oklahoma State Department of Health has published its draft proposed Medical Marijuana Control Program regulations which, if implemented in their current form, would provide for the licensure of laboratories to test and approve various medical marijuana products. However, both the statutes implemented by SQ 788 and the regulations proposed by Department of Health are still subject to change.

Q: What are the main requirements that must be met in order to obtain a license as a dispensary, commercial grower, processor or researcher?

A: In each case, an individual or entity wishing to obtain a license to operate as a dispensary, commercial grower, or processor, must submit an application to the Oklahoma State Department of Health along with a $2,500 fee. The application must establish that the applicant: is 25 or older; is an Oklahoma resident, in the case of entities, that all members, managers and board members are Oklahoma residents and that no more than 25 percent of its ownership is out-of-state; is registered to conduct business in Oklahoma; and isn’t incarcerated and doesn’t have either a nonviolent felony conviction in the last two years or any other felony conviction in the last five years. In addition, the Department of Health’s proposed regulations also would require submission of a criminal background screening as well as proof of a $50,000 bond made payable to the Oklahoma State Department of Health.

Q: Where can these new medical marijuana businesses operate?

A: Virtually any location as other businesses. The only direct exception is a dispensary can’t operate within 1,000 feet of a school. To ensure this freedom to operate these businesses, the statutes specifically prohibit a city or municipality from restricting zoning for the purpose of preventing the opening of medical marijuana establishments, and landlords are prevented from refusing to execute a lease with such businesses unless, by doing so, they would lose a licensing or monetary benefit under federal law. However, the proposed regulations of the Department of Health would create several practical limitations on where these businesses could be located. For instance, a dispensary may not be housed in the same location as a physician who can prescribe medical marijuana and the location where medical marijuana may be grown or processed is subject to more exacting security and privacy standards than those of a simple dispensary, which may limit the options for potential locations.

Q: When can these businesses obtain their licenses?

A: The statutes set an ambitious timetable of applications being made available within 30 days of the passage of SQ 788 and the establishment of a regulatory office for processing these applications within 60 days of passage. Furthermore, the statutes require that all applications must be processed within two weeks. However, these timetables are subject to alteration by the legislature and may be extended.


Published: 7/3/18; by Paula Burkes
Original article:

Roth: Reasons to stay ‘air aware’ in Oklahoma

By Jim Roth, Director and Chair of the Firm’s Clean Energy Practice Group. This column was originally published in The Journal Record on May 21, 2018.

Jim Roth is a Director and Chair of the firm’s Clean Energy Practice.

Roth: Reasons to stay ‘air aware’ in Oklahoma

Often Missouri is referred to as the Show Me State, yet we Oklahomans also typically like to see things ourselves to believe them. Yet, there are realities around us too opaque for the human eye, such as air quality and impacts to our health.

Thursday’s ozone warning, a second warning this month, was just such a reality reminding us of the rising temperatures and the growing dangerous levels of particulate matter that rise with warmer months in Oklahoma’s more urban areas. The Air Quality Index forecast, which prompted the warning, showed an AQI of 101, a level described as “Unhealthy for Sensitive Groups.” The accompanying health message indicates that “active children and adults, and people with lung disease, such as asthma, should reduce prolonged or heavy exertion outdoors.”

Now before you rejoice that an ozone warning simply provides a great excuse to put off mowing your lawn, for many Oklahomans it’s a much more serious challenge to their day. But first, let’s understand what makes up the ozone levels and the accompanying dangers.

This amazing Earth of ours has both naturally occurring and human-made pollution, which together create air quality issues impacting human health. And while I recognize a few (a very few, mostly political scientists, not science scientists) outliers still refute the enormous scientific consensus that human activity leads to climate impacts and climate change, have you ever noticed that our ozone health warnings usually apply only to Oklahoma City and Tulsa areas, where humans congregate and commute, where factories churn out industrial output, where cars, homes and buildings emit pollutions by their very existence? But I digress.

The Oklahoma Department of Environmental Quality does a great job monitoring the air quality across Oklahoma and providing advice and warnings to the public when conditions could be hazardous to our health. Bad air quality can affect everybody’s health and can be particularly harmful to fast-growing young children and aging seniors with reduced immune systems. It even has direct economic impacts through loss of working days and increased health care costs. It can also have harmful effects on sensitive vegetation and ecosystems.

And while we can make a marginal difference ourselves, the enormity of the situation really requires collective group efforts, which is why the Clean Air Act and related environmental regulations are designed to protect those vulnerable Oklahomans on days like Thursday. Ozone is one of six common air pollutants identified in the CAA, and the U.S. Environmental Protection Agency calls these “criteria air pollutants” because their levels in our outdoor air need to be limited based upon health criteria for Americans.

Ground-level ozone is the primary component of smog and it forms when nitrogen oxides and volatile organic compounds chemically react with sunlight of hot, windless days. Bad ozone itself is not emitted directly into the air, but is created from that chemical reaction (from other polluting resources emissions) when in the presence of sunlight. These pollutants come from a variety of sources including electric power plants, cars and trucks, construction equipment, gas-powered engines of all kinds, industrial facilities and even your backyard charcoal grills.

Unhealthy levels of ozone can cause increased risk of respiratory infection, throat irritation, coughing, shortness of breath, aggravation of asthma and other respiratory diseases and can even add dangers to people with diabetes, emphysema and cardiovascular diseases. During higher level of ozone days, the risks and impacts are made worse by activity and exercise outside.

There are actions that each of us can take to alleviate the risk, reduce air pollution and protect our health. If interested, please check out AirNow at the EPA website for some great tips:

Also, in Tulsa please consider INCOG’s site:

And in Oklahoma City, ACOG’s site:

So in addition to being “weather aware” this time of year, it makes sense for us Oklahomans to be “air aware”
too, even if you can’t see the pollution with your own eyes. Trust me, your lungs and bodies know it’s there.

Jim Roth, a former Oklahoma corporation commissioner, is an attorney with Phillips Murrah P.C. in Oklahoma City, where his practice focuses on clean, green energy for Oklahoma.

The HIPAA Employee Rules Needed to Protect Your Company

In this article, Oklahoma City healthcare attorney Mary Holloway Richard discusses how safeguarding patients’ electronic health information is an employment matter and how companies can enact HIPAA rules with their employees.

oklahoma city health care attorney mary richard

Mary Richard is recognized as one of pioneers in Oklahoma healthcare law. She has represented institutional and non-institutional providers of health services, as well as patients and their families. She also has significant experience in representing providers in regulatory matters.

Q: In preparation for an employee or other members of a health care company’s workforce quitting, what preventive steps can be taken to ensure that patients’ health information is protected?

A: Two particular measures are critical to health care providers, in their role as employers, to protect the private patient information. Those are preparation and training. First, advance preparation is essential. Administrative, technical and physical safeguards are mandated by HIPAA (the Health Insurance Portability and Accountability Act) and its amendments, and just as we recommend with regard to all types of health care compliance and regulations, a compliance plan should be in place to provide security for protected health information electronically maintained. The person responsible for a health care practice or company’s IT should perform periodic risk assessments, and sufficient access termination procedures should also be in place. Second, an important part of prevention is proper training. Just as we recommend preparation to respond to identity theft, employers must identify the individuals responsible for safeguarding electronically maintained protected health information and responding to a breach, and provide them with appropriate training. Since health care is such a labor-intensive industry, a high rate of personnel turnover requires proportionate re-training and monitoring of employees regarding compliance with privacy and other regulatory requirements.

Q: You mentioned termination procedures — what procedures provide effective deterrents to unauthorized use or access to electronically maintained protected health information in such situations?

A: As a part of an overall separation procedure, there are some critical checkpoints along the way. Health care providers/employers are advised to standardize the process and create a checklist of steps to be taken when an individual leaves. Document that these steps have been taken, including the return of any company equipment. Next, if the company or practice is large enough to have departments, it is important to quickly alert the department or staff members responsible for changing access to electronically maintained protected health information, deactivating or deleting user accounts and monitoring access. Also, after these and other important steps are carried out, I recommend a post-termination audit to verify that all necessary steps to cut off access to electronically maintained protected health information have been taken.

Q: What steps must be taken to terminate access to electronically maintained protected health information?

A: Such steps, in addition to terminating user accounts and reclaiming computers, laptops, iPads and cellphones, should include terminating access to the physical space, which may require changing locks, access codes, and authorized individuals lists. Obviously, keys, fobs, ID badges, card keys and other items by which the former employee gained access to the physician space must be reclaimed or reprogrammed so that access by the former employee or other former member of your company’s workforce to secure areas with electronically maintained protected health information is no longer possible. For all former employees, and particularly for those with remote access, deactivation of any remote accounts and accessibility should reach all levels of access so that portals, web access and email services are no longer accessible.


Published: 5/9/18; by Paula Burkes
Original article:

Director Jim Roth to speak on 2018 Legislative Session forum panel

Jim A. Roth, Phillips Murrah

Jim Roth is a Director and Chair of the firm’s Clean Energy Practice.

Director Jim Roth will participate in a panel during the First Week Forum, an event hosted by The Journal Record designed to inform attendees about hot topics and major issues facing the state and nation during the 2018 Legislative Session.

The First Week Forum will host sessions from 3 to 7 PM this Thursday at the Oklahoma City University School of Law.

Roth will be speaking during the Energy Panel alongside Mark Yates, Director of the Oklahoma Wind Coalition; Chad Warmington, President of Oklahoma Oil and Gas Association; and John Harper of American Electric Power who will be moderating.

“The Journal Record is bringing sunshine to the state capitol political sausage factory at an unprecedented time of budget woes and two concurrent legislative Sessions,” Roth said. “We will discuss the issues of the day and hope Oklahomans can gain information for their benefit going forward.”

Other panel topics include criminal justice reform, education and health care, and registration for the event is free.

Those interested can view a full list of speakers and panels here.

Roth: A victory for fossil fuels over renewables

By Jim Roth, Director and Chair of the Firm’s Clean Energy Practice Group. This column was originally published in The Journal Record on November 13, 2017.

Jim Roth is a Director and Chair of the firm’s Clean Energy Practice.

A victory for fossil fuels over renewables

At this juncture, it isn’t shocking to read the new tax proposal and learn that it harms renewable energy.

The headlines immediately bifurcated the energy sector into winners (fossil fuels) and losers (renewables). Retention of many long-standing fossil fuel breaks and incentives were an unsurprising boon for oil and gas companies, while the phase-out of many energy efficiency-related investment tax credits have the green energy industry angry and activated, and rightfully so.

It is counterintuitive that the tax proposal injures wind so badly, since it is proven, efficient, and reliable, and complements well with natural gas as the least expensive power source(s). While logic can’t be tied to the attack on wind, politics can. The tax proposal keeps in line with the current administration’s efforts to favor fossil fuels, especially coal, no matter how dirty or expensive. Plus, the revenue yanked from wind incentives goes to fund the newly created corporate tax revenue hole, which the Congressional Budget Office estimates this past week is the largest part of the $1.7 trillion estimated the GOP plan adds to America’s debt.

Subtitle F (the proposal’s heading dealing with energy credits) inadvertently got the letter grade it deserved as it outright fails renewable energy. Under the plan, the $7,500 tax incentive on electric vehicles is eliminated. States that mandated goals for zero-emission vehicles did so with an expectation of the incentive. Not to mention EV car companies whose business projections are based on the existence of the tax credit and a chance to keep American car manufacturers competitive with the world.

This section also contains certain repeals of oil and gas incentives, too, namely, the repeal of tax credits for marginal wells. This is especially negative for Oklahoma as the age and extent of our historic oil and gas production means we still have a significant number of marginal wells at work here in Oklahoma. Since many of these are owned and operated by mom-and-pop companies, it seems the GOP draft favors today’s large corporations over small businesses, at least as it relates to oil and gas marginal wells.

Another less obvious way the plan helps oil and gas corporations and harms renewable energy developers is the latter’s reliance on tax equity investors. Larger exploration and production-companies will benefit from the new corporate tax rate of 20 percent, down from 35 percent. But the model for many renewable energy projects relies upon, among other things, tax equity financing. When tax exposure is lower, it could follow that there would be less interest in tax equity financing projects, of all kinds, and especially energy.

Nevertheless, I remain steadfast in my confidence for our state’s and nation’s diverse energy future. Of course this optimism is buttressed by the reminder that there are still forthcoming amendments, and this plan will not likely become the final law. The bill, as proposed, violates the “Byrd rule,” a Senate reconciliation rule that, in part, allows senators to block legislation when it would considerably increase the federal deficit beyond a 10-year term.

So far, there are over a trillion reasons either of our two U.S. senators could block this draft and insist it be rewritten to help all forms of Oklahomans’ energies. Stay tuned.

Jim Roth, a former Oklahoma corporation commissioner, is an attorney with Phillips Murrah P.C. in Oklahoma City, where his practice focuses on clean, green energy for Oklahoma.

Certificate of Need Laws Can Bridle Behavioral, Other Care

In this article, Oklahoma City healthcare attorney Mary Holloway Richard discusses Oklahoma’s Certificate of Need laws with the Daily Oklahoman newspaper.

oklahoma city health care attorney mary richard

Mary Richard is recognized as one of the pioneers in Oklahoma healthcare law. She has represented institutional and non-institutional providers of health services, as well as patients and their families. She also has significant experience in representing providers in regulatory matters.

Q: What are Certificate of Need (CON) laws and what is the status of CON in Oklahoma?

A: The history of CON laws is an interesting one. Federal law required CON for facilities that received federal funds to construct facilities. By 1978, unique CON statutes were passed in 36 states. Although the federal mandate was repealed in 1987, many states still have CON laws in place. The CON system was intended by Congress as one mechanism for controlling healthcare costs by controlling development. The idea was that unnecessary beds or services would drive up the costs and miss system efficiencies and economies of scale. Development was broadly defined to include activities ranging from new development, acquisitions, mergers, management agreements, leases, stock purchases and changes in ownership via foreclosure. The Oklahoma legislature repealed CON laws in all areas except for psychiatric and chemical dependency services and long-term care.

Q: What are the current requirements for developing long-term care and behavioral health services in Oklahoma under these statutory schemes?

A: For long-term care, the Oklahoma law provides for the development of long-term care services in a “ … planned orderly economical manner consistent with and appropriate to services needed by people in various (parts of Oklahoma) ….” Development must match or reflect the need demonstrated in the CON application as evaluated by the state Department of Health. The statutes also enumerate the powers of the Department of Health with regard to long-term care facilities and services. The law applies to long-term care facilities including nursing homes, specialized facilities such as long-term acute care and skilled nursing facilities and the nursing component of continuity of care and life care communities. For psychiatric and chemical dependency service facilities, the process is outlined in the statutes and includes application requirements, findings by the state Board of Health, providing bases for the board’s decision, the opportunity for appeal of the board’s decision and an explanation of potential penalties for failure to comply.

Q: Some writers and consultants in the healthcare industry contend that these laws no longer serve the purposes for which they were created by legislatures or fail to achieve the ostensible objectives. Is this fair criticism?

A: All segments of the healthcare industry are highly regulated. There is a good argument to be made that business decisions in the healthcare space are guided by reimbursement, the impact of effectiveness and outcome metrics, and classic business principles such as market share and that, while the original ideas supporting the CON effort may have been sound, the system now provides an additional hurdle and expenses in two areas of significant needs in our state — services to the elderly and others requiring long-term care and to those suffering from behavioral health diagnoses. More specifically, Oklahoma’s CON rules apply only to hospitals so that development for treatment facilities not considered “hospitals” by the Oklahoma Department of Health are not covered by the CON procedures and limitations. The result is that addiction treatment facilities providing services, including beds, only require the approval of the Oklahoma Department of Mental Health and Substance Abuse Services, which does not have its own CON process and can be developed without hindrance.

Q: Is there interest among Oklahoma lawmakers to repeal the last vestiges of CON law in Oklahoma?

A: Although this issue has come up in the last several years, it has not been successful. No such legislation was proposed in the first regular session of this legislative term, which ended in May. In terms of the status of CON laws in the nation, as of 2016, 14 states had discontinued their certificate of need requirements and 34 continued with some remnant of the CON system.

Published: 10/12/17; by Paula Burkes
Original article:

Phillips Murrah named Best Place to Work by Journal Record

Journal Record Best Place to WorkPhillips Murrah is proud to announce that our Firm has been recognized as one of the Best Places to Work in Oklahoma by The Journal Record.

“We are excited to be recognized as being one of the Best Places to Work,” said Phillips Murrah President and Managing Partner, Tom Wolfe. “We take pride in providing exceptional legal services while striving to provide a positive, balanced atmosphere for our attorneys and staff.”

Phillips Murrah is the only law firm on the Best Places to Work in Oklahoma list. The workplace culture at our Firm is a unique blend of experience and enthusiasm. Whether we are celebrating at a Firm-wide party or competing at a regatta with our Phillips Murrah rowing team, there are plenty of opportunities for everyone at Phillips Murrah to come together and solidify the team. It is a true work hard, play hard environment.

Working with Best Companies Group, The Journal Record has nominated 24 small and medium companies and 16 large companies for the 2017 award and recognized them at a luncheon Sept. 28. Read The Journal Record’s profile on Phillips Murrah.

To learn more about the workplace culture and opportunities at Phillips Murrah, visit our Careers page


Roth: Florida taxes oranges?

By Jim Roth, Director and Chair of the Firm’s Clean Energy Practice Group. This column was originally published in The Journal Record on February 13, 2017.

Jim Roth is a Director and Chair of the firm’s Clean Energy Practice.

Florida taxes oranges?

If you were to read a headline that the state of Florida was looking to add a 25-percent tax to the price of oranges, you might scratch your head and wonder why they would intentionally hurt one of their largest industries. In Florida, agriculture is second only to tourism.

Such was my reaction when Oklahoma state leaders unveiled an idea this past week to tax their way out of a recurring budget shortfall dilemma by proposing a new tax on Oklahoma’s wind energy, thereby raising the cost of every single Oklahoman’s monthly utility bill. Wind energy accounted for roughly 20 percent of the state’s total electricity last year, so you can do the math about an increase to 20 percent of your electricity fuel bill.

The proposed $5 per megawatt-hour of wind power generation amounts to an approximate 25-percent increase to the cost of wind power, which is now being developed and sold in Oklahoma at around $20 per Mwh.

It’s also interesting to note that only one other state in America has a tax on wind production and Wyoming, where coal is king, has a $1-per-megawatt-hour tax, a whole one-fifth of Oklahoma’s proposed new tax rate.

Oklahoma has enormous energy blessings in the form of natural gas, wind and oil. Recently, the U.S. Energy Information Administration updated its state rankings and has Oklahoma third in the country in natural gas production and fifth in crude oil production. Oklahoma is now also ranked third in wind power with 6,645 megawatts of wind capacity as of the end of 2016, just surpassing California and now trailing only Texas (20,321 MWs) and Iowa (6,917 MWs).

It’s true what Oscar Hammerstein wrote about Oklahoma in our fabled state song, “…where the wind comes sweeping down the plain, and the wavin’ wheat can sure smell sweet,” yet we probably aren’t “doin’ fine” if we are so desperate to tax one of our leading industries, 25 percent to just make budget.

There’s a better way, if you think there is a necessity to push new taxes on electricity generation. There’s an Oklahoma way. Develop a tax approach that makes pollution more expensive, not Oklahoma’s clean energy. And this is an approach being pitched nationally by a large group of prominent, conservative Republicans, who believe it’s time to tax carbon, a real villain, rather than American energy itself.

Former Secretaries of State James Baker and George Schultz, former Treasury Secretary Hank Paulson, business leaders like Rob Walton, former chairman on Wal-Mart, and many others were in D.C. this month meeting with Vice President Mike Pence and other leaders to detail their blueprint for a $40-per-metric-ton tax on carbon dioxide pollution, with the price escalating over time. And yet the policy would actually protect low-income Americans from higher energy bills, unlike Oklahoma’s proposed wind electricity tax. Under Baker’s proposal, the projected $200 billion to $300 billion in annual revenue from the carbon tax would be distributed to households, by quarterly checks, from the Social Security Administration. It is estimated that families of four would receive about $2,000 a year in payments to them, not from them.

And through it all America would be transitioning, even more quickly to a cleaner energy economy and leading the world.

Oklahoma could lead also by a similar approach, rather than hobbling one of its leading industries, with large investments in the state, by targeting wind. We should target negative aspects of human behavior; such is the justification for increasing cigarette taxes, right?

An Oklahoma pollution tax would make winners out of our state’s cleaner-burning natural gas and wind industries, would drive greater production and demand for both and would in turn reduce health care costs to families and businesses by reducing harmful pollutants in our air. We would send less hard-earned Oklahoma money to Wyoming for imported coal, where we are buying their schoolbooks instead of our own. We would in turn incentivize Oklahoma’s energy future by creating a growing market, not a shrinking one.

“Florida taxes fattening fried potatoes” makes more sense to me than “Oklahoma taxes its own wind.”

Jim Roth, a former Oklahoma corporation commissioner, is an attorney with Phillips Murrah P.C. in Oklahoma City, where his practice focuses on clean, green energy for Oklahoma.

Roth: One-eyed vision?

By Jim Roth, Director and Chair of the Firm’s Clean Energy Practice Group. This column was originally published in The Journal Record on December 19, 2016.

Jim Roth is a Director and Chair of the firm’s Clean Energy Practice.

One-eyed vision?

Proverbs 29:18 KJV tells us: “Where there is no vision, the people perish: but he that keepeth the law, happy is he.”

And while there is debate among theologians about certain meanings and interpretations over the centuries, the underlying notion of vision leadership and adherence to it leading to happiness rather than to perish is clear. Equally important to this idea, I believe, is that the vision must be clear, complete and visible with both eyes.

Such is possibly not the case for Oklahoma legislators responsible for creating the vision for Oklahoma’s future. Our 2017 legislators will be asked to digest recent recommendations of public policy from the Oklahoma Incentive Evaluation Commission, yet the written word is but one-half of the story; one eye on some facts, with a blind one to the rest of the story, so-to-speak.

Here’s what I mean. On Dec. 15 the IEC submitted its report on 11 state economic tax incentives, all reviews of which were performed by an out-of-state firm (PFM) and submitted in November. The report suggested six “retains,” three “reconfigures,” one “allow to sunset” and one “repeal.”

Interestingly enough, the commission voted to accept all recommendations, except they specifically rejected the one “repeal,” thereby telling the Legislature to somehow maintain, in some form, all 11 state economic tax incentives. This may be a tough sell for a Legislature that will be dealing with yet another declining revenue picture and shrinking state budget; early estimates are $500 million less in the coming year.

Yet, our Legislature should take pause at this report, as their actions regarding it will either grow or diminish the state’s vision for years to come. And while I have tremendous respect for the commission members tasked with this difficult analysis, especially considering the short crunch time they had, I have greater concern that our Legislature may rely upon it without their own two-eyed, deeper thinking to get these issues right for Oklahoma.

I work in energy law and I also work in wind energy issues. And from this vantage I know that a full economic analysis of the costs and benefits of any energy tax structure/incentive/treatment must analyze both the local and state impacts. Such is not the case with this firm’s state-focused report to the IEC, and therefore such is not the case with the IEC’s report to the Legislature.

And while PFM admitted it didn’t analyze anything other than calculating costs to the state, some of the crucial failures of their one-eyed approach are:

• The analysis fails to take into account local impacts (schools, counties, cities, landowners), where the majority of the benefits of renewable energy exist.

• The $3.3 billion in appraised value of installed equipment and increased local property tax values and revenue to schools and local governments.

• The $1.2 billion in ad valorem taxes projected to be paid by wind developers between 2003 and 2043, money that wouldn’t exist but for those investments.

• The more than $10 billion invested in Oklahoma since 2003, in landowner payments, local jobs, taxes and investments.

It is right that we analyze annual costs to state government and the budget dilemma, hence costs to all of us, but it is dangerous to our state’s future if legislators act upon one-eyed analysis, especially now when our state family’s budget must plan for a future beyond just this next session. Let’s resolve for 2017 that our Oklahoma vision includes a clear, two-eyed view of the benefits to an energy future that is truly all-the-above as renewables have helped us become.

Jim Roth, a former Oklahoma corporation commissioner, is an attorney with Phillips Murrah P.C. in Oklahoma City, where his practice focuses on clean, green energy for Oklahoma.

Roth: Sunny opportunity for Oklahoma schools?

By Jim Roth, Director and Chair of the Firm’s Clean Energy Practice Group. This column was originally published in The Journal Record on September 12, 2016.

Jim Roth is a Director and Chair of the firm’s Clean Energy Practice.

Jim Roth is a Director and Chair of the firm’s Clean Energy Practice.

Sunny opportunity for Oklahoma schools?

According to the Oklahoma Policy Institute and other reputable observers, “Oklahoma had the dubious honor of having made the deepest cuts to school funding in the nation since the start of the recession in 2008. Now an update from the Center on Budget and Policy Priorities shows that our lead has widened. Adjusted for inflation, Oklahoma’s per student school formula funding has dropped 23.6 percent over the past six years, significantly more than in any other state.”

And that observation was in late 2014. As of 2016, on average Oklahoma continues to spend at the rate that maintains our ranking as 48th among the 50 states and the District of Columbia.

And as we know today our state’s budget dilemmas have only worsened in 2015 and 2016, with historic funding cuts further affecting investments in our public schools, our teachers and ultimately our young citizen students.

But rather than focusing on the budget appropriation side of schools’ economics, I want to share an idea with our state leaders that might actually be a win-win for schools by creating real budget relief in the form of lowering their costs of operations and creating an income opportunity.

Here’s how: Oklahoma’s 1,784 public school buildings spend a great deal of money to provide electricity for heating and cooling throughout the school year, and this growing expense in each school’s annual budget is often regarded as a mandatory expense without options. But that’s not true; Oklahoma does have options.

Imagine the installation of solar panels on top of many of these more than 1,000 school buildings all across the state, generating more electricity than the school itself needs and exporting that excess power to the grid, every month of the year and actually creating more income back to the school than the solar systems cost. Yes, income. How’s that for running government like a business?

It’s happening all across America already, as solar energy is booming in America, with installations in 2016 expected to double the amount from record-breaking 2015 and a trend line toward 20 gigawatts annually by 2020. The cost to install solar has dropped by more than 70 percent over the last 10 years, leading the industry to expand into new markets and deploy thousands of systems nationwide, including with many business and schools.

According to a recent report by the Solar Foundation and the Solar Energy Industries Association, there are nearly 4,000 K-12 schools in the United States with active solar systems, meaning more than 2.7 million American students attend solar schools. The report also found that thousands of other schools could save money by going solar. The large, flat rooftops typically found on public and private K-12 school buildings throughout Oklahoma make these buildings ideal for rooftop solar photovoltaic or solar thermal systems.

Parking lots and solar canopies are another obvious opportunity for Oklahoma schools to generate power, even more than their own buildings require, and the beauty of solar power is that the systems are generating energy at the most expensive time of the day. If you want to teach students something smart and observable every day outside of a textbook or a web page, schools can instruct students by doing something so obvious and observable to them every day.

Oklahoma is home to only one current solar installation at a public school, in the Tulsa area, yet there is enormous potential for school districts of all sizes all across the state. Our Legislature and our governor will need to agree with this idea and make slight changes to Oklahoma law to unlock this opportunity for our many cash-strapped public schools.

The utilities may fight it, as they’ve shown an intention so far to work against citizens who want to install and afford solar, but the Oklahoma taxpayer will love it. And after all, public officials take an oath to serve the citizens and this sunny opportunity is a great way to bring funding relief to our schools.

Jim Roth, a former Oklahoma corporation commissioner, is an attorney with Phillips Murrah P.C. in Oklahoma City, where his practice focuses on clean, green energy for Oklahoma.

Roth: PSO, AMI and ROI

By Jim Roth, Director and Chair of the Firm’s Clean Energy Practice Group. This column was originally published in The Journal Record on July 25, 2016.

Jim Roth is a Director and Chair of the firm’s Clean Energy Practice.

Jim Roth is a Director and Chair of the firm’s Clean Energy Practice.


Wow, it’s hot. And it looks like it’s gonna be hot for a while still, as is not a surprise to us Oklahomans.

And once you recall the incredibly warm winter we just had, one can only imagine what August may feel like here. And as we’ve been discussing the last few weeks, a high-temperature weather month can often be followed by a high-cost electric utility bill the next billing cycle.

And as we’ve learned, deployment of new technology is providing customers near real-time price information and abilities to monitor and manage monthly costs, while also providing utility providers with a new slew of information and efficiencies to improve service and lower costs. It’s proving to have a real return on investment for both sides of the meter, so-to-speak.

Case in point: AEP’s Public Service Company of Oklahoma and their advanced metering infrastructure, as of this month, is now fully deployed across PSO’s vast Oklahoma service territory with the installation of more than 560,000 new meters, including those first pilot program meters in the Owasso area beginning in 2010. And with a seemingly huge reception from all territory customers, with over 99.5 percent of customers participating in the AMI program.

PSO has rightly indicated that the AMI program will provide an array of benefits to customers.

And they are not alone as several Oklahoma electric utilities have been using this type of technology for many years and the penetration rate nationwide is nearly 50 percent. I’m glad to see our customers are faring better than the national average and I’m also glad to know that PSO meets the highest standards of cybersecurity with encrypted technology to safeguard customer information. In fact, the Oklahoma Electric Usage Data Protection Act prohibits all utilities from providing any customer information to outside third parties.

And now for the extraordinarily good news for PSO customers: With the full installation of this metering technology, PSO was greatly aided in responding to the devastating storms and outages earlier in July (with 109,000 customers out at one point it was the third-largest storm by customers affected in PSO’s history), the AMI made possible the restoration of service to nearly everyone within three days.

And for those regular storm-free days when Oklahoma’s heat bakes the state, AMI has helped PSO provide new programs for customers’ budget needs, such as PowerHours and PowerPay.

PowerHours, which is similar to OG&E’s SmartHours program, runs June through October and allows enrolled customers to choose from four programs to save money through managed use.

Information on the options is available at

Likewise, PowerPay is a voluntary program where customers can prepay for their usage, giving them greater control over the frequency and timing of their payments. No more surprise utility bills the month after high prices. Instead the customer is engaged in energy consumptions, management and related savings in this pay-as-you-go approach. It’s not for everyone, but is a good option for many, so please check it out and see if it’s right for your budget and household.

The return on PSO’s AMI investments can be directly enjoyed by its customers who explore these options, enroll in those that make the most sense for them, and control their own destiny through price signals, energy shifts and energy savings. It’s an exciting time when the cost of next month’s utility bill is based upon what customers choose to do this month for themselves.

Jim Roth, a former Oklahoma corporation commissioner, is an attorney with Phillips Murrah PC in Oklahoma City, where his practice focuses on clean, green energy for Oklahoma.

Director shares insights into Oklahoma’s clean energy future with Sierra Club

Jim Roth represents individuals and both publicly-owned and private companies in a range of business, energy and environmental issues, as well as a variety of public policy and regulatory matters.

Jim Roth represents individuals and both publicly-owned and private companies in a range of business, energy and environmental issues, as well as a variety of public policy and regulatory matters.

Phillips Murrah Director Jim Roth spoke to the Sierra Club on June 16 about issues regarding Oklahoma’s future in the clean energy arena.

“The Sierra Club has been a national leader in moving the American economy towards a low emission future,” he said. “Oklahoma is perfectly situated with low-emitting resources in abundance: clean burning natural gas; significant wind integrations and now tremendous solar potential.”

Jim is Chair of the Firm’s Clean Energy Practice Group. As a former Oklahoma Corporation Commissioner, Jim helps his energy clients navigate the regulatory environment encompassing new and existing energy technologies so they can accomplish their business and policy goals.

For years, the Oklahoma Chapter of the Sierra Club has successfully protected Oklahoma’s wildlife, preserved its natural resources, and educated the public on many issues at the local, state, and federal level.

Learn more about the Sierra Club’s Oklahoma Chapter here.

Roth: Oklahomans deserve to hear the facts about wind energy

By Jim Roth, Director and Chair of the Firm’s Clean Energy Practice Group. This column was originally published in The Journal Record on June 20, 2016.

Jim Roth is a Director and Chair of the firm’s Clean Energy Practice.

Jim Roth is a Director and Chair of the firm’s Clean Energy Practice.

Oklahomans deserve to hear facts about wind energy

It’s no surprise that a review of taxes and tax incentives has recently garnered significant attention from lawmakers, voters and the news media as legislators worked this session to combat a historic budget shortfall. One of the most scrutinized policies has been the zero-emissions tax credit, set to expire in 2020, which will be the wind energy industry’s only remaining tax credit as of the end of this year.

As an Oklahoman dedicated not just to forward-looking, clean energy solutions, but also as someone who champions a diverse energy economy in our state, I’ve been floored by the misinformation about wind energy espoused recently by some state officials, reporters and other influencers. It’s time to set the record straight.

Perhaps the most egregiously misrepresented topic is the value of the last remaining tax credit in comparison to the dollars wind energy brings to our state, both in terms of corporate, ad valorem and other tax contributions and in terms of investment, jobs and infrastructure.

Some outspoken opponents have nonsensically implied wind energy’s one incentive is to blame for everything from the budget deficit to ongoing declines in general revenue collections. However, they fail to produce numbers that support these claims and do not consider how incentives to other industries – some of which receive multiple incentives – affect the state’s coffers as well. This paints an inflammatory, misleading and inaccurate picture of the billions of dollars the wind energy industry has contributed and will continue to contribute to our tax base and to state and local economies.

For 2015, the wind energy industry will receive an estimated $46 million as a result of this tax credit, a helpful but relatively small incentive compared to other industries, when considering facts such as:

• The industry has invested nearly $10 billion in Oklahoma and plans to continue investing.

• Economists predict wind energy developers will contribute about $1.2 billion in ad valorem taxes alone through 2043, directly benefiting local schools and communities.

• More than 7,000 Oklahomans can attribute their jobs to wind energy.

• Oklahoma’s largest utilities (OG&E and PSO) have locked in over $2 billion in customer savings through their own wind contracts, according to their own statements.

The zero-emissions tax incentive was created with the goal of drawing renewable investment to Oklahoma during a time when we were missing out on these dollars due to more attractive financial circumstances in neighboring states. Because of our incentive, wind energy now produces almost one-fifth of the electricity powering our homes and businesses and provides the cheapest form of electricity to Oklahomans. The case for keeping wind in our diverse energy mix is a strong one. And it’s made even stronger by tough state budgets reeling from a downturn in the oil and gas industries.

I encourage our elected officials, news media and others to check the facts and make sure the full story on wind energy is being told. As November elections draw near and Oklahoma voters evaluate our state’s leadership, its only right they hear the unbiased truth about this major economic contributor for Oklahoma. The truth my friend, is blowing in the wind.

Jim Roth, a former Oklahoma corporation commissioner, is an attorney with Phillips Murrah PC in Oklahoma City, where his practice focuses on clean, green energy for Oklahoma.

Roth: An all-time-low rig count

By Jim Roth, Director and Chair of the Firm’s Clean Energy Practice Group. This column was originally published in The Journal Record on March 28, 2016.

Jim Roth is a Director and Chair of the firm’s Clean Energy Practice.

Jim Roth is a Director and Chair of the firm’s Clean Energy Practice.

An all-time-low rig count

The current national rig count hit an all-time low this month, totaling 476 rigs engaged in the exploration and production of oil and gas in the U.S. Of that number, 446 rigs were engaged in land operations, while 27 rigs were offshore and three were inland water activity. And this week it dipped even lower to a total rig count of 464.

This new low may not be a surprise to us Oklahomans, who are feeling the pain of a depressed commodity environment, massive job losses and a state budget in seeming free fall. But the decline is very dramatic, with the rig count being less than half of last year’s level and less than 25 percent of the 2008 peak exceeding 2,000 rigs in the U.S.

And the numbers are even starker for natural gas rigs, with just 89 rigs directed at natural gas, down from the 2015 count of 242, and way off the 2008 number of more than 1,600 natural gas-directed rigs. Plenty of news for a pessimist to find comfort. But what about an optimist?

Some observers suggest that tight oil production today occurs with greater success because of shale rig efficiency, and therefore production will continue to increase in spite of lower rig numbers. Others believe that the rig count is meaningless because rig counts are tied to longer-term contracts between operators and drilling companies and aren’t a week-to-week barometer of the rise or fall of oil or natural gas prices.

And still others drill down further (pun intended) for data points specific to the tight oil plays, where wells are the most productive typically, and further into the horizontally drilled wells in those plays, as the most productive specifically. Our state’s own Mississippi Lime and Granite Wash, as well as the Eagle Ford, Niobrara, Permian Basin and Bakken are watched closely for this very glimpse for production specificity. And these plays have also seen massive drops in their rig count year over year, which perhaps gives us an even clearer impression of the general direction of future production.

So whether you are inclined to watch the specific rig counts in tight oil plays in your own production areas and neighborhood, whether you follow the Saudis and OPEC for signals about oil (and gas) prices and production on the world stage, or whether you monitor domestic storage levels as the indicator of prices and activity to come, it’s probably best to contemplate it all rather than one singular data point such as American rig count.

Either way, let’s hope this new low is truly the bottom and that better prices, new jobs and brighter budget days are ahead for a producing state like ours sooner than later.

And just in case it’s not, we should probably say an Easter prayer that Oklahoma doesn’t have all its eggs in one energy basket and that wind and solar and other energies can offset the pain we feel from our old friend oil.

Jim Roth, a former Oklahoma corporation commissioner, is an attorney with Phillips Murrah PC in Oklahoma City, where his practice focuses on clean, green energy for Oklahoma.

Limiting Liability in the Oilfield

By Catherine L. Campbell and Thomas G. Wolfe.
This scholarly article is originally published in the Oklahoma Bar Journal– Jan. 16, 2016– Vol. 87 No. 2.

Parties are free to contract in any way they see fit so long as their contract does not violate public policy. Likewise, the parties to a contract may agree to allocate the risks of loss between them — including pre-performance exoneration of a negligent service provider from the consequences of its own negligence — if their consent to such risk allocation is mutual.

Limiting Liability in the Oilfield

Click to read full article @

Oklahoma courts judge the existence of mutuality of consent, in part, by determining whether the parties enjoy sufficiently-equal bargaining power. This inquiry depends on the importance of the requested service to the economic well-being of the party seeking the service, and the nature of the market providing that service. On the one hand, courts are more likely to conclude that a customer seeking a service it wants but does not need in a market with numerous providers is on equal footing with the service provider. On the other, a customer seeking a necessary service offered by few providers, or offered by many providers that demand similarly onerous contract terms, has no power to allocate risks in a way more beneficial to it. The choice between accepting unfavorable terms hoping nothing goes wrong or declining the necessary service altogether is no choice at all.

These principles apply to oilfield service contracts. Undoubtedly, the economic risks in the oilfield are high. Although pre-service allocation of the risks is preferable, only a negotiated — and thus mutually agreed allocation of risks based upon equality of bargaining power — will pass judicial muster.


A basic premise of Oklahoma law, and indeed contract law in general, is that parties are free to contract as they see fit,1 as long as the contract is not contrary to law or violative of public policy.2 However, Oklahoma prohibits contracts that attempt to exempt a contracting party from responsibility for its own fraud, willful injury to persons or property, gross negligence or that otherwise violate public policy.3

Oklahoma distinguishes between various risk-shifting tools — broadly characterized as “exculpatory provisions,”4 — including limitation of liability clauses, indemnity provisions and exculpatory clauses. Because under certain circumstances exculpatory provisions are valid and enforceable, they are ubiquitous in modern commercial life. Oklahoma courts enforce exculpatory clauses only if: 1) they “clearly and unambiguously” exonerate the defendant with respect to the claim; 2) there exists no significant difference in the bargaining power between the contracting parties; and 3) enforcement will not otherwise violate public policy.5 While an exculpatory provision need not mention the word “negligence” to be valid,6 the agreement to exculpate must be clear from an examination of the entire contract.7 An exculpatory clause is sufficiently clear and unambiguous when it identifies the party to be indemnified and the nature and extent of damages.8

As for equality in bargaining, courts have traditionally concluded that public policy forbids enforcement of exculpatory provisions in 1) bailment contracts, 2) employment contracts, 3) contracts with common carriers, 4) contracts with innkeepers and 5) utilities contracts.9 In these instances, courts perceive that the service provider enjoys vastly superior bargaining power over the consumer. Not incidentally, these service providers often use adhesion contracts — “standardized contract[s] prepared entirely by one party to the transaction for the acceptance of the other.”10 Adhesion contracts are take-it-or-leave-it since “the services that are the subject of the contract cannot be obtained except by acquiescing to the form agreement.”11 By definition, the parties to an adhesion contract do not share equal bargaining positions.12

That a contract is one of adhesion (with the consequent presumption of lack of equal bargaining power) is not sufficient, standing alone, to invalidate an exculpatory provision. Instead, Oklahoma courts require evidence of something more than a slight disparity in bargaining power between the parties to nullify an exculpatory provision. When the disparity of bargaining power renders the freedom to contract illusory, an exculpatory clause is unenforceable.

In Trumbower v. Sports Car Club of America, Inc.,13 the court recognized guidelines for determining whether the contracting parties enjoy relatively equal bargaining positions. First, courts should “generally consider categories of individuals rather than a particular individual.”14 Second, courts must weigh “the importance which the subject matter of the contract has for the physical or economic well-being of the party agreeing to release the other party.”15 And, the court must consider “the existence and extent of competition among [service providers] measured by the amount of free choice the [consumer].”16

Applying Trumbower, Oklahoma courts have enforced exculpatory provisions when the activity at issue is a hobby or sport.17 Moreover, the releasing party is not forced to use a particular vendor or, ultimately, to engage in the activity.18 Correspondingly, Oklahoma courts have approved exculpatory provisions where the contracting party presumably had wide choice in service providers.19

Some jurisdictions presume that commercial parties generally enjoy equal bargaining power while assuming that ordinary consumers do not.20 However, Oklahoma law mandates that courts consider the economic realities of the transaction, not the parties’ relative sophistication. Each case stands on its own facts.21

All or some variation of the recognized risk-shifting mechanisms — releases, limitation of liability clauses, and indemnity provisions — “are widespread in oilfield contracts” since, like most businesses, providers and consumers of oilfield services benefit from assuring clear allocation of risks at the outset of the contractual relationship.22 Some oilfield contracts contain indemnity provisions (also known as knock-for-knock provisions) that require each party to assume all risk associated with its equipment and personnel regardless of fault.23  Often, the parties contemplate that they will insure their respective contractual obligations.24  Other oilfield contracts treat service providers more favorably.25 Finally, operators may use master service agreements with contractual terms favorable to them and which allow them to contract with service providers before any work is performed, ideally permitting the parties to negotiate terms in a lower pressure environment.26

Oilfield exculpatory clauses are typically clearly delineated and, in any case, are well known in the industry.27 Therefore, courts may conclude that such agreements “clearly and unambiguously” exonerate the intended party. Nonetheless, as three cases applying Oklahoma law demonstrate, because pre-work risk allocation in the oilfield is legally appropriate only when it results from relative arm’s length bargaining, the economic reality of the bargaining positions between the parties is the paramount consideration.

In Mohawk Drilling Co. v. McCullough Tool Co.,28 while performing “specialized” work on Mohawk’s well, McCullough lost equipment downhole requiring Mohawk to rework the well. The purchase order stated that McCullough “shall not be held liable or responsible for any loss, damage or injury” to the well resulting from the work it performed.29 The evidence showed that, because other companies that could have performed the same specialized work used contracts containing similar exculpatory language, the well owner could not obtain the necessary service without exculpating the service provider.30 Although Mohawk predates Schmidt,31 the Mohawkcourt employed the same factors — economic necessity of the requested service and availability of the service in the market free of exculpatory provisions — in determining that McCullough “enjoyed much greater bargaining strength” so that the exculpatory contract was “against [Oklahoma] public policy.”32

More than 30 years later, in Kinkead v. W. Atlas Int’l, Inc.,33 Kinkead orally contracted with Western to remove the drill string when it became impacted in the borehole. Before Kinkead executed a written work order, Western lost the drill string in the casing which ultimately resulted in abandonment of the well. First, since the evidence showed that the exculpatory language at issue was common in the industry, the court rejected Kinkead’s argument that the oral agreement with Western did not contain the same exculpatory language as the written agreement.34 Second, Western offered evidence that Kinkead could have contracted with other companies that either did not require, or would have negotiated to remove or modify, similar exculpatory language. Consequently, impliedly weighing the same factors as the Mohawk court, the court concluded that the evidence was sufficient to sustain the jury verdict for Western.35

Finally, in Arnold Oil Props., LLC v. Schlumberger Tech. Corp.,36 Arnold contracted with Schlumberger, whose contract contained both a knock-for-knock indemnity provision and a limitation of liability clause. The court concluded that the evidence at trial was sufficient to support the jury’s determination that Arnold and Schlumberger were in unequal bargaining positions because: 1) the service was “critical” to Arnold’s operations; 2) a limited number of providers could perform the services and/or most if not all providers used similar exculpatory language; and 3) the exculpatory terms of three other providers’ contracts were non-negotiable.37 The court further noted that Schlumberger’s contract did not permit the customer to bargain for a higher limit on liability.38

A review of cases applying Oklahoma law reveals that chief among the factors to be resolved in determining whether to enforce an exculpatory provision in an oilfield contract is the number of service providers and whether most, if not all, service providers demand inclusion of similarly burdensome exculpatory provisions. If providers in the market insist on the same contractual provisions, without meaningful negotiation and as a pre-condition to performing economically essential services, the contract clause is unenforceable. The size and sophistication of the provider relative to the customer is not pertinent to the inquiry. Though the customer may eventually opt to accept the offered terms from the provider rather than pay a higher contract price, it must be given a meaningful opportunity to do so. In the absence of the opportunity to negotiate terms, there is no mutual consent.

Oklahoma is not alone in recognizing the fundamental importance of economic reality in oilfield risk allocation. According to USA Today, as of Dec. 31, 2011, Texas had the most oil reserves of any state in the country while Louisiana had the 10th highest.39 To level the playing field between powerful producers and the less powerful contractors who, though forced to indemnify the producers against their own negligence could not procure insurance to adequately cover the risk, both states enacted statutes that generally void oilfield indemnity clauses.40 Louisiana and Texas made public policy choices based not on the contracting parties’ knowledge and sophistication, but on the perceived inequality of bargaining between equally sophisticated commercial entities. Though not codified in statute, Oklahoma law is similar.

Undoubtedly, form contracts and industry custom reflect past economic conditions in the oilfield; but, the market for oilfield services is far from static. In recent years, oil and gas production in the United States has markedly increased. During periods of lower production service providers may be more willing to compete for work and more willing to accept greater risk. It is equally true that, during periods of higher production, demand for services outstrips supply, increasing competition for scarce resources. These market factors are magnified when the services provided are highly specialized — which means a decreased number of available service providers.

Oklahoma case law prudently elevates economic realities over industry custom. Where the service purchaser’s ability to obtain an essential service is limited either because there are few providers and/or because most providers require acceptance of the same non-negotiable exculpatory language, exculpatory agreements may be unenforceable. Thus, in terms of commercial entities, knowledgeable in the field, the decisive factor is not whether the exculpatory language is unequivocally clear. Instead, at issue is the economic reality underlying the presumed freedom of the parties to strike a deal.

In Oklahoma no party is forced to insure against risks for which it was not afforded a chance to bargain. It is unfair to shift the burden of loss to the operator when it has no power to protect itself. Oklahoma case law is clear: each party to a contract must be allowed to balance the risks against the cost of the service provided. A contract which deprives the party of its freedom to negotiate risk allocation likely violates Oklahoma law.

1. E. Cent. Elec. Coop. v. Pub. Serv. Co., 1970 OK 80, 469 P.2d 662, 664.
2. Ball v. Wilshire Ins. Co., 2009 OK 38, 221 P.3d 717, 724, 726.
3. OKLA. STAT. tit. 15, §212.
4. Schmidt v. United States, 1996 OK 29, 912 P.2d 871, 874.
5. Kinkead v. W. Alliance Int’l, 1993 OK CIV APP 132, 894 P.2d 1123, 1128.
6. See Estate of King v. Wagoner County Bd. of County Comm’rs, 2006 OK CIV APP 118, 146 P.3d 833, 844.
7. Otis Elevator Co. v. Midland Red Oak Realty, Inc., 483 F.3d 1095, 1105 (10th Cir. 2007).
8. Mercury Inv. Co. v. F.W. Woolworth Co., 1985 OK 38, 706 P.2d 523, 530.
9. Stacy A. Silkworth, Note: The Pilotage Clause: Albatross of Admiralty Law, 64 B.U. L. Rev. 823, 848-49 (July 1984); see, e.g., Sun Oil Co. v. Dalzell Towing Co., 287 U.S. 291, 294 (1932); Bisso v. Island Waterways Corp., 349 U.S. 85, 90-91 (1955).
10. Bilbrey v. Cingular Wireless, L.L.C., 2007 OK 54, 164 P.3d 131, 135.
11. Wilson v. Travelers Ins. Co., 1980 OK 9, 605 P.2d 1327, 1329.
12. See, e.g., Max True Plastering Co. v. U.S. Fid. & Guar. Co., 1996 OK 28, 912 P.2d 861, 864.
13. 428 F. Supp. 1113, 1117 (W.D. Okla. 1976).
14. Id. (citation omitted).
15. Id. See also 57A Am. Jur. 2d Negligence §62 (noting that “a seller must offer a service that is usually deemed essential in nature”).
16. Id. See also Allen v. Michigan Bell Tele. Co., 171 S.W.2d 689, 692 (Mich. App. 1969) (“[W]here goods and services can only be obtained from one source, or several sources on non-competitive terms, the choices of one who desires to purchase are limited to acceptance of the terms offered or doing without. Depending on that nature of the goods or services and the purchaser’s needs, doing without may or may not be a realistic alternative.”).
Additionally, the Trombower approach is consistent with the RESTATEMENT (SECOND) OF TORTS §496B. Comment j states that “disparity in bargaining power may arise from the defendant’s monopoly of a particular field of service, from the generality of the use of contract clauses insisting upon assumption of the risk by all those engaged in such a field, so that the plaintiff has no alternative possibility of obtaining the service without the clause; or it may arise from the exigencies of the needs of the plaintiff himself, which leave him no reasonable alternative to the acceptance of the offered term.”
17. See Schmidt, supra at n. 4, 912 P.2d at 873 n. 7, 874 n. 18 (recreational horseback riding); Manning v. Brannon, 1998 OK CIV APP 17, 956 P.2d 156, 159 (parachuting); Martin v. A.C.G., Inc., 1998 OK CIV APP 148, 965 P.2d 995, 997 (health club). These activities are not “necessary or important to [the contracting party’s] physical or emotional well-being,”Manning, 956 P.2d at 159.
18. Martin, 965 P.2d at 997.
19. Rodgers v. Tecumseh Bank, 1988 OK 36, 756 P.2d 1223, 1226 (noting that a commercial loan agreement was not an adhesion contract since borrowers have a choice of loan providers, and the evidence showed that the parties actually negotiated the terms of the agreement in an arms-length transaction).
20. See, e.g., Henry Heide, Inc. v. WRH Prods. Co., Inc., 766 F.2d 105, 109 (3d Cir. 1985).
21. Elsken v. Network Multi-Family Security Corp., 1992 OK 136, 838 P.2d 1007, 1010; Thompson v. Peters, 1994 OK CIV APP 97, 885 P.2d 686, 688; Trumbower, supra at n. 13, 428 F. Supp. at 1117; Kinkead, supra at n. 5, 894 P.2d at 1128.
22. Chesapeake Operating, Inc. v. Nabors Indus., USA, Inc., 94 S.W.3d 163, 167-68, 180 (Tex. App. 2002).
23. Id. at 167. The Association of International Petroleum Negotiators (AIPN) 2002 International Model Well Services Contract indemnity provisions state that the indemnities are non-fault. See Chidi Egbochue & Herbert Smith, “Reviewing ‘Knock for Knock’ Indemnities Following the Macondo Well Blowout,”
24. The AIPN 2002 International Model Well Services Contract allows the parties to arrange for self-insurance or insurance.See Egbochue & Smith, supra n. 23. Similarly, the IADC form drilling contract recognizes that the parties may allocate risk via the purchase of insurance; Andrew R. Thomas, “Service Contracts in the Oil and Gas Industry,” Energy Policy Center, Levin College of Urban Affairs Cleveland State University, December 2013, at 4.
As the court, in Appalachian Ins. Co. v. McDonnell Douglas Corp., 262 Cal. Rptr. 716, 731 (Cal. Ct. App. 1989), noted in a complex commercial case:
[I]t was not commercially unreasonable for the parties to agree [Customer] would obtain insurance to protect it against the risk of loss rather than to have [Contractor] warrant performance….As a practical matter, it was a question of whether [Customer] wanted to directly pay for insurance by obtaining insurance itself or indirectly pay for insurance by requiring [Contractor] obtain the insurance and give a warranty.
In Appalachian Ins. Co., Western Union hired McDonnell Douglas, one of two companies providing the service, to launch a communications satellite. Western Union chose McDonnell Douglas as the cheaper and more reliable option though both companies were available to launch on Western Union’s schedule. Id. at 729. Importantly, despite the limited number of service providers in the highly specialized market, the parties negotiated the terms of their contract including the exculpatory language. Id. The evidence showed that the contract resulted from an arms-length transaction between equals. See also Chi. Steel Rule & Die Fabricators Co. v. ADT Security Sys., 763 N.E.2d 839, 845 (Ill. Ct. App. 2002) (observing that there existed no evidence of disparate bargaining power between the commercial entities when 1) the provider was not the only alarm system provider in the market, and 2) the parties’ contract allowed the customer to pay more so that the provider would assume more risk indicating that the customer had the opportunity to negotiate to shift the risk).
25. See Thomas, supra at n. 24, at 4 (noting that the International Association of Drilling Contractors form drilling contract generally favors drillers by placing responsibility for damages to the rig on the operator).
26. See William W. Pugh & Harold J. Flanagan, “Master Service Agreements and Risk Allocation: In Whose Good Hands Are You?”; Thomas, supra at n. 24, at 1.
27. Kinkead, supra at n. 5, 894 P.2d at 1126.
28. 271 F.2d 627, 632 (10th Cir. 1959).
29. Id. at 629.
30. Id. at 632.
31. Schmidt, supra at n. 4, 912 P.2d at 874.
32. Id. (citing an unpublished Oklahoma Supreme Court case in predicting how the Oklahoma courts would rule on the issue).
33. 1993 OK CIV APP 132, 894 P.2d 1123.
34. Id. at 1127-28.
35. Id. at 1128.
36. 672 F.3d 1202 (10th Cir. 2012).
37. Id. at 1208.
38. Id. at 1209.
39. Paul Ausick & Michael B. Sauter, “The 10 Most Oil-Rich States,” USA Today, Aug. 3, 2013,
40. See Louisiana Oilfield Indemnity Act, LA REV. STAT. ANN. §9:2780 and Texas Oilfield Anti-Indemnity Act, TEX CIV. PRAC. & REM. CODE ANN. §127.001. et seq. See also Fontenot v. Chevron U.S.A., 676 So.2d 557, 562 (La. 1996) andKen Petroleum Corp. v. Questor Drilling Corp., 24 S.W.3d 344, 348 (Tex. 2000). While top-10 producers New Mexico and Wyoming also enacted similar statutes (New Mexico Oilfield Anti-Indemnity Act, N.M. STAT ANN. §56-7-2 and Wyoming Oilfield Anti-Indemnity Act, WYO STAT. §30-1-131 et seq.), both did so to promote worker safety. Pina v. Gruy Petroleum Mgmt. Co., 136 P.3d 1029, 1033 (N.M. 2006) Union Pac. Res. Co. v. Dolenc, 86 P.3d 1287, 1292 (Wyo. 2004).

Thomas G. Wolfe is the managing partner at Phillips Murrah law firm in Oklahoma City, where his litigation practice is focused on complex business cases including product liability, oil and gas, mass tort and class action defense. He has served on the Oklahoma Association of Defense Counsel Board of Directors and is a master of the William J. Holloway Jr. American Inn of Court.

Catherine L. Campbell is a director and shareholder at Phillips Murrah law firm in Oklahoma City. She is an experienced appellate attorney whose practice is focused on commercial litigation and labor and employment matters. She has represented clients in state and federal courts of appeal in more than 100 cases including representing law enforcement agencies in civil rights actions.

Roth: Ex-Im Bank must have its life span extended

Jim Roth’s Friday column, Earth Business, appears in The Journal Record.
Originally published in The Journal Record on July 17, 2015.
View Jim Roth’s attorney profile here.

Jim Roth is a Director, Chair of the firm’s Clean Energy Practice and a former Oklahoma Corporation Commissioner.

Ex-Im Bank must have its life span extended

The hotly contested Export-Import Bank of the United States has been in existence since 1934 by executive order, was made a separate agency by Congress in 1945 and exists to finance and insure foreign purchases of American goods for customers unable or unwilling to accept credit risk.

This seemingly sleepy entity has been in the news lately due to its upcoming potential death. Its most recent three-year charter lapsed as of July 1 because of Congress’ inaction and unwillingness to reauthorize. Today, the bank cannot engage in new business and can only manage its existing loan and business portfolio.

The Ex-Im Bank has been a dividing political issue since its conception. Created to help the U.S. increase exports and create more jobs here, it has been hugely successful in those objectives.

The Ex-Im Bank currently helps 129 Oklahoma companies with global exports of nearly $1 billion in total export value, $938 million in total insured shipments, guaranteed credits or disbursed loan amounts and $815 million in total authorizations. This enormous economic infusion has created thousands of Oklahoma jobs creating products, machines and services.

The U.S. Import-Export Bank, like most Ex-Im banks around the world, focuses in financing private-sector exports and has helped create or maintain many thousands of jobs all across America. Its recent years have seen more focus toward energy and manufacturing products, thus creating a growing political divide in Washington along the way.

Today, those most concerned about the potential death of the bank have been the alternative energy sectors, which have used the bank more recently to finance some of their green energy ventures. Yet just a few years ago, the bank was heavily criticized for “being on a fossil-fuel binge” for supporting liquid gas projects for Exxon-Mobil in Papua New Guinea and a coal plant in India with ties to Wisconsin business interests.

Meanwhile, growing antagonism today about the bank seems to be coming from lobbyists in the fossil-fuel sector and conservative groups representing American banks that don’t want the competition for lending.

And to stray away from any specific sector of the U.S. economy to the larger picture, it is clear what the importance of the Ex-Im Bank is to the U.S. economy. The future of American exports and job creation seems bleak without the institution because this is the U.S. Ex-Im Bank, while many other countries have their own banks that finance exports and they have bidding wars in highly contested export markets.

What this means is that if the U.S. Ex-Im bank did truly die on June 30, the U.S. export market is likely to shrink exponentially without financing. This loss of financing may hurt small businesses worse, those who rely on the bank for their overseas transactions. In fact, significant percentages of the bank’s finances go to small businesses with 164,000 jobs created in 2014 alone. So the facts are pretty clear that without the U.S. Export-Import Bank American businesses and jobs are at stake. Surely Congress must understand that?

It is critical that our country support the U.S. Ex-Im bank for its importance to American businesses, both large and small, in places like Oklahoma and beyond.

We cannot let party politics affect our financial future negatively. If U.S. industry wants a better future for markets overseas, the U.S. Ex-Im Bank must have its life span extended.

And oh by the way, the best part is that it won’t cost taxpayers a thing. When do we ever get that good of a trade?

Wind gets caught in political volley

Jim Roth’s Friday column, Earth Business, appears in The Journal Record.
Originally published in The Journal Record on Feb. 13, 2015.
View Jim Roth’s attorney profile here.

Jim Roth is a Director and Chair of the firm’s Clean Energy Practice.

Oklahoma’s cleanest and cheapest form of electricity comes from its own wind projects. Although our utilities don’t operate under a mandate, or what’s known as a renewable energy portfolio standard, like many states, we have a goal calling for 15-percent renewable energy by 2015. According to the Corporation Commission, our state enjoyed 18.42 percent of its energy from eligible renewable energy resources in 2013. That trend continues. With the American portfolio of renewable energy growing and utility portfolios further diversifying, wind energy produced 14 percent of American electricity in 2013 and early 2014. Turbine technology is improving; wind is more available to generate electricity than ever. We’re on the map as the sixth-largest state for wind power. The future of renewables here seems very promising.

Yet a few case studies address what can happen when political winds change and politicians begin to push policies choosing coal at the expense of wind development.

Investments in the Australian market for renewable energy face a very stark contrast from where the country was headed, due in large part to the changing political winds. The Australian Renewable Energy Target is a key policy established in 2001 designed to ensure that 20 percent of the country’s electricity comes from renewable resources by 2020. Since the RET legislation in 2001, pro-renewable energy activist groups across Australia have raised substantial investments and awareness for the benefits of renewable energy. However, the fate of Australia’s RET has been placed in jeopardy by political leaders.

Reports show that investment in large-scale renewable energy projects have plummeted over the past year. While investment in global renewable energy is up by 16 percent, Australian numbers have dropped by 88 percent. Australia Prime Minister Tony Abbott and his pro-coal agenda have created serious ambiguity in federal government’s position on renewable energy policy and investors are leery. Many investors and developers are considering either downscaling or leaving Australia altogether. The downward trajectory will undoubtedly continue for years to come. Many Australian developers are looking to invest in the United States and other global renewable energy markets. A spokesperson for General Electric, an investor in renewable energy projects in Australia, said future investment will only occur once investor confidence in the policy environment is restored.

This sounds good for America and perhaps for Oklahoma, but only if our state and country continue to welcome and nurture this growing industry. It’s arguable that similar anti-renewable efforts in some states may damage the overall contributions to America’s growing portfolio of renewable energy resources. A reversal of policies could have the same chill on investments, steering billions of dollars to neighboring states or regions, as is happening with Kansas.

In 2009, Kansas legislators passed an RPS requiring state utilities to capture 20 percent of their electricity from renewables. Legislative efforts and debates last year failed to repeal this law, but newly re-elected Gov. Sam Brownback is beginning to sound more like Abbott than a governor of a wind-rich state, with no coal industry to speak of. Recent legislation proposed by state Rep. Ken Corbet, R-Topeka, seeks to reduce the RPS to 10 percent in 2015 and repeal the RPS statute by July 1, 2016.

Let’s hope that Oklahoma’s political leaders don’t forsake our state’s clean energy promise by following the lead of Kansas or Australia, or even fostering an anti-investment environment such that our state faces the same loss or potential loss beginning to appear elsewhere. Stay tuned to this legislative session.