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Senate extends aerospace tax-credit sunset to 2031; bill passes 33-13
Summary
On third reading the Oklahoma Senate approved Senate Bill 287, extending expiring aerospace tax credits through Dec. 31, 2031. Debate focused on eligibility timing and the possible effect of federal layoffs at Tinker Air Force Base.
Senate Bill 287, which extends the sunset on certain aerospace tax credits, passed the Oklahoma Senate 33-13 on third reading Monday. The bill’s author, Senator Pugh, told colleagues the measure adds five years to credits scheduled to expire Jan. 1, 2026, moving the expiration to the end of 2031.
Supporters said the extension is intended to sustain the state’s aerospace workforce and investment. "Senate Bill 287 takes the expiring aerospace tax credits, which are set to expire 01/01/2026, and, puts a 5 year addition to those, so they will expire, at the end of 2031," Senator Pugh said during his explanation on the floor.
The session’s substantive debate centered on who may claim the credit and how federal layoffs could affect eligibility. Senator Hicks asked whether an employee must be employed a full year before claiming the credit: "Do they have to be employed for a full year before receiving this?" Senator Pugh replied, "it's it's it's not a full year. It would be at the time of their filing. So it could it could end up it wouldn't be a prorated amount, but the time that they could have served as an engineer in the state could be a..."
Lawmakers also discussed recent news of possible federal layoffs at Tinker Air Force Base and whether affected workers could still claim the credit for prior work. Senator Hicks noted the timing and raised concerns about the state’s ability to retain aerospace talent if federal reductions continue: "I will be supporting this measure today, but I also just wanna call to light that it is very disappointing and disheartening, that potentially we are gonna be set back by actions at the federal level..." Senator Pugh explained that the credit is claimed for prior-year work and that a person who later loses a qualifying engineering job would not be eligible for subsequent years unless they return to qualifying employment.
After debate the Senate recorded a 33-13 vote in favor. The clerks closed the roll and the presiding officer declared the bill passed on third reading.
