State government; creating the Anti-Perverse Incentive Act. Effective date. Emergency.
Summary
SB 1740 creates the “Anti-Perverse Incentive Act” and applies it to state agencies as defined under Oklahoma’s Administrative Procedures Act. The bill requires that any fine or fee for a statutory violation assessed by a state agency against an individual or business be deposited into the General Revenue Fund rather than retained by the agency that assessed it. It also states that General Revenue Fund distributions would occur in the usual manner, without regard to how much a particular agency collected.
The bill further requires that no state-agency fine or fee for a statutory violation may be assessed unless there is an appeals process available. Under that process, an individual or business could challenge a fine or fee if they reasonably believe it was punitive and unrelated to the agency’s mission, or motivated by personal or political reasons by an employee or official. If an appeal determines that an employee or official abused the authority to assess a fine or fee, that person would be subject to a penalty of $1,000 or the amount of the appealed fine or fee, whichever is greater, and any such penalty would also go to the General Revenue Fund.
Impact
The bill would change how state agencies handle enforcement revenue by removing direct financial benefit from fines and fees and routing those collections into the state’s General Revenue Fund. It would also impose a new procedural requirement on agencies to provide an appeals mechanism for challenged fines and fees, and it would create a personal penalty for agency employees or officials found to have abused fine-assessment authority. The measure would affect state agencies broadly, as well as individuals and businesses subject to agency-issued fines or fees for statutory violations.
Sentiment
The available context shows limited public or legislative debate, with no committee transcript excerpts or recorded votes provided. Based on the bill’s framing, it appears intended to address concerns about agency self-funding and incentives tied to enforcement revenue, suggesting a reform-oriented and oversight-focused posture. Its referral to Rules and then Appropriations indicates it was still moving through the legislative process without a clear recorded consensus in the provided materials.
Contention
The main points of contention are likely to be the bill’s restriction on agency revenue retention and its new appeal and penalty provisions. Supporters would likely view the measure as a safeguard against agencies issuing fines for revenue generation or improper motives, while opponents may argue it could weaken agency enforcement tools, create administrative burdens, or invite challenges to legitimate regulatory penalties. The personal fine on employees or officials for abusive assessments is especially notable, as it directly targets agency conduct and could be seen as either a deterrent against abuse or an overbroad threat to enforcement personnel.